can you set up a company, transfer house to it, then rent to yourself

chewmylegoff

chucknorris wrote: »

As others have said I can't see what you would achieve, I don't think that you could 'transfer' your house to a limted company, wouldn't you have to sell it and pay stamp duty plus legal fees? I must admit though I am no expert on limited companies, so open question to the forum:

Is there a way to 'transfer' an asset to a limted company rather than actually sell?

you would need to sell it to the company, but you could sell it for notional consideration i.e. £1. stamp duty is assessable on the cash value of the transaction, not the market value. (i suppose you could gift it to the company as well, although that wouldn't really change any of the below).

however, selling it for £1 would be a very stupid thing to do as it would mean that when the company sold the asset, it would make the entire selling price of the asset (minus £1) a gain chargeable to corporation tax. moreover the company would be classified as an investment company which i think means that the entire gain would be taxable at the highest rate of corporation tax.

you could of course try selling it back to yourself for £1, but unfortunately that would mean you would be assessed as having received a benefit in kind - i.e. you would be subject to income on the market value of the property you had received and the company would have to pay employers national insurance.

the other option is to sell the company's shares - this would precipitate a gain chargeable to CGT on you, which would be more tax efficient, but would still be entirely unnecessary.

in short, it's a pretty bad idea.

Loughton_Monkey

The_White_Horse wrote: »

and claim tax relief on the interest?

Here's an alternative way of doing it:

1. Join a political party. E.g. Conservatives.
2. Get nominated for a seat.
3. Get elected to Parliament.
4. Help get your party elected to Government.
5. Become either Prime Minister or Chancellor.
6. Re-introduce tax relief on Mortgage Interest.

[Oh.. and while you're at it, introduce an unlimited savings plan through NS&I for retirees, at a guaranteed RPI+10% interest, and abolish tax on any form of pension payment.]

Generali

Loughton_Monkey wrote: »

[Oh.. and while you're at it, introduce an unlimited savings plan through NS&I for retirees, at a guaranteed RPI+10% interest, and abolish tax on any form of pension payment.]

Sensible policies for a happier country (if introduced in 30 years time when I don't have to pay).

chucknorris

chewmylegoff wrote: »

in short, it's a pretty bad idea.

So as I suspected, a really dumb idea, no surprise there then.