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Having an argument at work so any expert opinion could resolve it please! (we've googled and it's not clear to us).
If you own a property and buy a buy to let ie an additional, you get stung with a big stamp duty. But if you set up a Limited Company that doesn't own any properties, does it pay a lower single property fee or not, or does a Ltd Co. pay higher rates than a personal stamp duty?
It's clearly a tricky area, even Jeremy Hunt can't get it right.
Not sure stamp duty was payable on the Jeremy Hunt transactions - I think he bought 8 flats - but 6 property transactions all completed on the same day count as a commercial transaction with the result that domestic stamp duty rules don’t apply - as and when they are disposed of corporate tax rules would apply to any capital gain or loss.
From my understanding from several developer/multi unit owners, there's a way of doing it tax efficiently and reducing stamp duty liability by going through a ltd co. Think you need a good accountant experienced in this kind of thing, but a good starting point is look up Progressive Property on FB, they have a good community on there who are always helpful with up to date advice.
What? The tax system of our great country being a quagmire of confusion and potential tax avoidance? Who'da thunk it?
IIRC the Danish and Hong Kong tax codes, if printed out, would each be 300ish pages (font size and page size unspecified...) UK's would be 21,000...
It can be done.
thanks all ... not sure our argument here is concluded. Hey ho
I spoke with a tax expert on this and it is possible if you set up a partnership, but you cannot just set up a partnership and buy a btl to avoid the higher rate. It must be seen as your day to day business and job, so 1 does not really qualify. Maybe 10 i dont know, but my few certainly cannot be deemed a full time activity. Even at my snails pace of work....
Funny as it was on a property podcast, the rob and rob one, where they said the higher rate stamp duty was avoidable if buying via a partnership. So i asked my acct and got the above answer.
Hope it helps
As with all these things it seems if you are a little better off you have to pay the tax, if you are seriously welthy, the tax is avoidable.
poolman and thebrick - that probably settles it here! Thanks