Buying house to live using ltd company

Jonathan1205

I am thinking of buying a house via ltd company to live. I have seen lots of posts regarding BTL ltd company options but not about living in the property

 I am not a cash buyer.  Need a mortgage. Happy to put 30% down payment.  I know that BTL mortgages won’t allow owner to live even for short term.

i was wondering if anyone got any experience on this?

thank you:)

AdrianC

Why would a lender lend to your limited company?

I assume you'll be paying the limited company a fair market rent, else you're going to have benefit-in-kind income tax to pay.

What are you actually hoping to achieve by doing this?

davidmcn

Jonathan1205 said:

I know that BTL mortgages won’t allow owner to live even for short term.

And you think they haven't considered your cunning wheeze either? Leaving aside all the tax disadvantages of doing it this way.

SDLT_Geek

If the property is worth over £500,000 there will be 15% SDLT to pay and the Annual Tax on Enveloped Dwellings.

Jonathan1205

We will be paying market price rent amount. I am currently renting but rent is up renewal in 6 months. I was not planning for ltd route initially. My plan was to buy a larger property in 2019 in my name and settle down. Covid affected my financial/ work situation. Don’t want commit large amount until work is stable / at the same time don’t want waste 15k on renting another year plus 7% property price increase. So I was thinking of buying something Small   in long view for BTL. My understanding is ltd is better better option/ current trend esp for high tax payers. That’s why I wondered if anyone knew ltd company with residential mortgage for 2 years. 

Jonathan1205

It will be less than 500k

SpiderLegs

Jonathan1205 said:

We will be paying market price rent amount. I am currently renting but rent is up renewal in 6 months. I was not planning for ltd route initially. My plan was to buy a larger property in 2019 in my name and settle down. Covid affected my financial/ work situation. Don’t want commit large amount until work is stable / at the same time don’t want waste 15k on renting another year plus 7% property price increase. So I was thinking of buying something Small   in long view for BTL. My understanding is ltd is better better option/ current trend esp for high tax payers. That’s why I wondered if anyone knew ltd company with residential mortgage for 2 years. 

I’m confused.
surely if you are going to be paying rent then the property is a company owned BTL?

AdrianC

Jonathan1205 said:

We will be paying market price rent amount. I am currently renting but rent is up renewal in 6 months. I was not planning for ltd route initially. My plan was to buy a larger property in 2019 in my name and settle down. Covid affected my financial/ work situation. Don’t want commit large amount until work is stable / at the same time don’t want waste 15k on renting another year plus 7% property price increase. So I was thinking of buying something Small   in long view for BTL. My understanding is ltd is better better option/ current trend esp for high tax payers. That’s why I wondered if anyone knew ltd company with residential mortgage for 2 years. 

What's your accountant's opinion?

[Deleted User]

Jonathan1205 said:

We will be paying market price rent amount. I am currently renting but rent is up renewal in 6 months. I was not planning for ltd route initially. My plan was to buy a larger property in 2019 in my name and settle down. Covid affected my financial/ work situation. Don’t want commit large amount until work is stable / at the same time don’t want waste 15k on renting another year plus 7% property price increase. So I was thinking of buying something Small   in long view for BTL. My understanding is ltd is better better option/ current trend esp for high tax payers. That’s why I wondered if anyone knew ltd company with residential mortgage for 2 years. 

Can a company have a residential mortgage? That would seem odd. 

AdrianC

Lover_of_Lycra said:

Jonathan1205 said:

We will be paying market price rent amount. I am currently renting but rent is up renewal in 6 months. I was not planning for ltd route initially. My plan was to buy a larger property in 2019 in my name and settle down. Covid affected my financial/ work situation. Don’t want commit large amount until work is stable / at the same time don’t want waste 15k on renting another year plus 7% property price increase. So I was thinking of buying something Small   in long view for BTL. My understanding is ltd is better better option/ current trend esp for high tax payers. That’s why I wondered if anyone knew ltd company with residential mortgage for 2 years. 

Can a company have a residential mortgage? That would seem odd. 

The company would need a BtL mortgage, because the company is letting it. The company is not in residence.
The tenant just happens to also own the shares in the company.
If the tenancy is below market rent, then there's a taxable benefit in kind.