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millymollymandy678

How to transfer property into a ltd company

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Hi, 

I am aiming to transfer two properties which are currently in my name into a ltd company. I don't have the funds in the ltd company to put down a 25% deposit on both properties. I would effectively want to use the money released from the sale as a director's loan to buy the properties. Is this possible? Or is there any way to transfer the properties without saving up a whole new deposit? 

Furthermore, does any property bought by a ltd company incur the extra 3% stamp duty, or is a ltd company exempt from additional stamp duty for its first purchase?

Thanks

 

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You definitly need to pay stamp duty and the transfer will not be straight forward given there is a mortgage company involved and the LTD is efefctively buying the property from you. I have only done this as 'cash' so not sure of the mortgage implications and if they are a showstopper

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In addition to the 3% SDLT, you may also be liable for Capital Gains Tax if your properties have increased in value, as you will need to sell the properties to your limited company at market value. This may then mean it eats in to the equity you're planning to withdraw to use at the Director's Loan. 

There's the option to incorporate the BTLs, but there's a lot of things you'll need to comply with in order to do so, and can be expensive which outweighs the benefits. 

Seek tax advice and mortgage advice before doing anything.

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5 hours ago, DerekT said:

In addition to the 3% SDLT, you may also be liable for Capital Gains Tax if your properties have increased in value, as you will need to sell the properties to your limited company at market value. This may then mean it eats in to the equity you're planning to withdraw to use at the Director's Loan. 

There's the option to incorporate the BTLs, but there's a lot of things you'll need to comply with in order to do so, and can be expensive which outweighs the benefits. 

Seek tax advice and mortgage advice before doing anything.

 

I am curious, does the property have to be sold to the LTD ?

Can it just be a Directors Loan ? or can it be a gift ?

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