First Choice Property Accounting
Why choose First Choice property Accounting?
Get a dedicated and professional service
Support for all accountancy queries
Access to specialist knowledge
Dedicated account manager for all queries
The Benefits Of Using First Choice Accounting...
Ongoing Support
Maximised Investment Returns
Expert Investment & Financial Guidance
Why Do Investors Set Up A Limited Company To Invest Through?
The investment solution of utilising a limited company has become increasingly popular in recent years due to government incentives penalising higher-rate taxpayers; a limited company can deduct finance costs from the rental profits.
To summarise, setting up a limited company enables investors to:
1. Reduce tax costs – such as mortgage interests
2. Prepare for easy exits – it is easier to sell a company than a property
3. Earn dividends
4. Avoid inheritance tax through the creation of shareholders in the company
Financial Comparison Case Study
Via Individual
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Rental Income - £12,000
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Mortgage Interest - (6,000)
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Allowable Expenses - (1,000)
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20% Mortgage Interest Tax Credit - 1,200
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Income Subject To Tax- £11,000
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Tax @ 40%- (4,400)
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Profit Retained- £1,800
Via SPV
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Rental Income - £12,000
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Mortgage Interest - (6,600)
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Allowable Expenses- (1,000)
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100% Mortgage Interest Relief - (6,600)
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Income Subject To Tax- 4,400
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Corporation Tax @ 19%- (836)
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Profit Retained- £3,564
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