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    • Magginnis
    • By Magginnis 16th Apr 19, 8:52 PM
    • 8Posts
    • 0Thanks
    Purchasing additional buy to lets
    • #1
    • 16th Apr 19, 8:52 PM
    Purchasing additional buy to lets 16th Apr 19 at 8:52 PM
    My wife and I are retired now (aged 70).
    We have personal income which takes us into the 40% tax bracket.
    We are recently in the process of buying a number buy to let properties.
    We have been advised to set up a ltd company and purchase these within the company, 50% shareholder myself and 50% wife and then to place in our will to distribute the shares to our two children equally.
    I am keen to get any advice or thoughts please as to whether you think this would be the best way to proceed
Page 1
    • Terron
    • By Terron 16th Apr 19, 10:08 PM
    • 402 Posts
    • 400 Thanks
    • #2
    • 16th Apr 19, 10:08 PM
    • #2
    • 16th Apr 19, 10:08 PM
    I have been using a company for new BTLs for a few years now.
    The problems with using a company are:
    a) costs including mortgage rates are a bit higher
    b) you could end up paying more tax when trying to take money out of the company

    The main advantage would be that you won't pay extra tax due to the reduction in mortgage relief. That could be significant if you already pay a significant amount of mortgage interest..

    A small company can be tax efficient, If you just pay director's pensions there is may be no net tax until you take money out of the pension beyond the 25%. That is limited to your pension allowance. That works for me.
    • Keep pedalling
    • By Keep pedalling 16th Apr 19, 11:02 PM
    • 6,263 Posts
    • 7,236 Thanks
    Keep pedalling
    • #3
    • 16th Apr 19, 11:02 PM
    • #3
    • 16th Apr 19, 11:02 PM
    If you already have income that high in retirement, why are you looking to increase it and lock mor3 of what appears to be significant wealth in property. Maybe it is time to start looking at inheritance planning and shift some on your net worth to your children now?
    • BBH123
    • By BBH123 17th Apr 19, 8:51 AM
    • 954 Posts
    • 2,065 Thanks
    • #4
    • 17th Apr 19, 8:51 AM
    • #4
    • 17th Apr 19, 8:51 AM
    You're brave going into BTL in retirement.

    I'm selling mine before I retire as I want a hassle free retirement and no complications.

    As above if its a means of inheritance planning I'd think again. Are you sure your children would want shares in a limited company and the management that would take ?
    Save 6k in 2019 challenge #44
    1577 / 6000
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