Merging 2 companies

flyer

I have 2 limited companies, each owing a house which is completely unencumbered. I want to combine the 2 so I can use the properties as leverage for a loan. Can I do this myself or do I have to employ a solicitor? TIA

oldbikebloke

flyer said:

I have 2 limited companies, each owing a house which is completely unencumbered. I want to combine the 2 so I can use the properties as leverage for a loan. Can I do this myself or do I have to employ a solicitor? TIA

so, your question is: can Company A sell a property to Company B?

Answer: yes, of course it can.
Does company A understand its corporation tax  position upon such disposal?
Does Company A have any competence in terms of DIY conveyancing?

flyer

Thanks. In answer to your questions, yes to a and no to b. However, I was assuming it would be easier for company A to acquire company B, rather than buy the property?

Pennywise

Each company is a separate legal entity, so as things stand, one has to buy the property from the other at open market value, which triggers all the usual taxes, stamp duty, etc.
There is a possibility of creating a group structure, where company B is owned by company A (rather than you), or both companies are owned by new holding company C, and then you may be able to transfer the property through at no gain/no loss for tax purposes, but you need a very experienced accountant and solicitor to do that properly, which may cost more than just paying the tax on simple sale from A to B in the first place.