Buying your own property

Sutton891

could I set up a Ltd company to buy my house that has been on the market for two years

Isthisforreal99

If it had sufficient funds to do so then yes. If said company needs a loan to buy the property then how do you propose convincing a bank to lend to it?

Brie

How is this solving anything? Will the company be renting it out? Or just holding it for a future sale? Couldn't you do the same? And wouldn't you be the landlord effectively either way? Do you need the fuss? And the company and you will be paying sales fees now and again in the future.

Sutton891

it’s to release the equity

El_Torro

https://forums.moneysavingexpert.com/discussion/comment/82117046#Comment_82117046

Selling to a Limited Company which is owned by you won't free up any equity. You're better off keeping the property in your name and getting a new mortgage. Then again if you're trying to sell the property why remortgage?

Isthisforreal99

https://forums.moneysavingexpert.com/discussion/comment/82117046#Comment_82117046

And as I asked where is the company getting the money from to buy the property?

horsewithnoname

https://forums.moneysavingexpert.com/discussion/comment/82117046#Comment_82117046

what would this company use to buy your house? What assets does your company have?

Sutton891

https://forums.moneysavingexpert.com/discussion/comment/82117016#Comment_82117016

it’s to release the equity.

Isthisforreal99

https://forums.moneysavingexpert.com/discussion/comment/82117080#Comment_82117080

You have already said that but how would the company buy it?

CliveOfIndia

So you want to set up a brand new Ltd. Co., use that to buy the house off yourself, and stash the proceeds? Great plan, but …. as others have said, what is the company going to buy the house with? If it's an established company with a chunk of liquid money available then fine. But no bank is going to lend money to a new company, with no track record or trading figures, in order to buy an asset that doesn't directly benefit the company.

You need to re-think your approach. If it's been on the market for 2 years without selling, ask yourself why. Is it over-priced? Does it have defects (whether serious or minor) that you could address to make it more saleable?

The Ltd. Co. idea is a non-starter. You need to go the old-fashioned route of working out why it's not selling and fixing that.

Sutton891

my house is in the UK and has been on the market for two years, but unfortunately I haven’t been able to sell it. I’m wondering whether there is another option. Could I set up a UK Ltd company and have the company purchase the house from me?

I’m particularly interested in understanding:

Whether this is legally and practically possible

How the company could finance the purchase

What would happen to my existing mortgage

What stamp duty land tax and other land taxes the company would have to pay

Whether there would be any capital gains tax or personal tax implications for me

Whether I could then use the money or equity released from the sale towards purchasing and flipping properties

Whether there are any UK specific rules, restrictions or reporting requirements that I need to consider

I’m not looking to avoid tax. I’m trying to understand whether this could be a legitimate way of moving on from my property that I’ve been unable to sell for two years.

Has anyone done anything similar or is there an obvious reason why this wouldn’t work

If you have experience of this please identify any jurisdiction specific rules that apply particularly UK rules relating to SDLT, tax, mortgages, company ownership and transaction with connected parties

Thanks for any advice