Buying a property partly using own Ltd

Skag

I want to buy a property using party my own Ltd and partly my own "name" and my wife's. Say I get an annual income in my Ltd of £100k per year and have a £30k personal income from other sources. Would I be better off buying a property with a mortgage 100% in my company?
I would ideally like to fund it using all 3: company, me, wife. Can this be done? i.e. a company to have a percentage of a property? I would think yes, but don't know.
Or would it be a case of me and wife giving a loan to the Ltd, and then purchasing the property in the Ltd 100% ?

AdrianC

Your accountant really is the best person to answer that.

Skag

Ok I thought anyone relative here might have a quick answer.

00ec25

what does this company do? can it buy property?

assuming the property will be the home you live in, it would be suicidally tax inefficient for a company that you control to own it as "you'd" face ongoing benefit in kind tax as well as one offs for SDLT and eventual CGT

theartfullodger

Is this some cunning plan to save on tax? If so many might suggest it be hardly patriotic...

silvercar

The company could give you a loan in order for you to fund the deposit and purchase it in your name. You'd have to account for the loan of course, but that's the most logical way.

eddddy

theartfullodger wrote: »

Is this some cunning plan to save on tax? If so many might suggest it be hardly patriotic...

I'm not sure if that's a joke or not, but on that basis... putting money into an ISA to save on tax is unpatriotic.

Parliament intended that companies should be taxed differently to individuals (just like parliament intended that ISAs should save tax for individuals).

Perhaps it's 'unpatriotic' to do things which Parliament didn't intend/foresee in order to save tax. But I don't think that's the case here.

Skag wrote: »

Ok I thought anyone relative here might have a quick answer.

It depends on...

• what you want to achieve
• what you want to use the property for
• what your plans are many years into the future,
• your personal circumstances and your wife's personal circumstances.

00ec25

silvercar wrote: »

The company could give you a loan in order for you to fund the deposit and purchase it in your name. You'd have to account for the loan of course, but that's the most logical way.

superb method to ensure the OP incurs a section 455 Benefit in Kind income tax charge on an outstanding loan from the company

Skag

I just wonder, if I am a contractor for 5 years and have got a nice stash of money in my company, can I use that money to purchase a property to live in? Or would I have to take all the money out (and re-tax it) and then buy the property?
It's not a cunning plan or anything, I just wonder how does one use his Ltd money to buy a property?

Doozergirl

If it’s your house then you need to take the money out of the company and buy the house in your own name. If the company owns the house and you live in it, then you will be paying tax personally for as long as you live in it on the “benefit in kind” and any money you make when selling will be subject to Corporation tax instead of being tax free as your personal home.

You should speak to your accountant. In fact you probably should have spoken to your accountant about your intentions a couple of years ago to work out the most tax efficient way of taking money out of the company, but there you go.

ACG

You would not get a residential Mortgage. You could possibly buy it for cash (assuming that is an option) but it seems a very expensive way of doing it.

The company would be liable for CGT on the increase in value, as far as I am aware as an individual you would not. That is an expensive bill when you come to sell.

Also what happens if your limited company gets sued? You risk losing your home.