Quick summary for busy landlords
Written by Fiona Simpson, Buy to Let Mortgage Expert, The Mortgage Broker.
Book a Free Appointment with Fiona, Here
The 2025 Autumn Budget has tightened the tax net around personally owned rental property, while leaving the core advantages of limited company buy to let intact. This article explains what’s changed for landlords, when a company structure may help, and how to sense-check your portfolio strategy with expert mortgage advice.
Based in Scotland? See how these changes affect Scottish landlords.
Limited company buy to let mortgages have just become even more central to the landlord tax debate. The 2025 Autumn Budget confirmed a future rise in dedicated “property income” tax rates for individual landlords, while stopping short of adding National Insurance to rental income and leaving stamp duty bands untouched for now.
At the same time, the earlier uplift in the additional SDLT surcharge on second homes, buy to lets and company purchases continues to bite on acquisitions by both individuals and limited companies.
For many higher-rate and portfolio landlords, the direction of travel is clear: personal ownership keeps getting more heavily taxed, while limited company structures still typically allow full deduction of mortgage interest against rental profits (subject to professional tax advice). That doesn’t mean a company is right for everyone, but it does mean your structure, financing and long-term plan now matter more than ever.
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Your property may be repossessed if you do not keep up repayments on your mortgage.
This article is general information only and is not tax, legal or investment advice. Always speak to a qualified accountant or tax adviser before acting.
Key Budget takeaways for landlords at a glance
- Property income tax going up: separate, higher tax rates for rental income from 2027-28 for individuals, increasing the income-tax drag on personally held portfolios.
- No NI on rental income (for now): the Chancellor chose not to extend National Insurance to rental income, avoiding an extra hit that many feared.
- Mansion-style property levy from 2028: a new high value property surcharge on homes over £2m, expected to affect a relatively small, higher end slice of the market rather than mainstream buy to lets.
- SDLT surcharges remain punishing: the higher rates surcharge on additional dwellings and residential company purchases now sits well above standard bands and continues unchanged.
- Housing demand expected to recover gradually: Budget clarity has calmed markets; many analysts expect a modest recovery in housing activity into 2026, with buy to let remaining an important part of the market.
What actually changed for landlords in the Autumn Budget?
Property income tax: a new, higher banded system for landlords
The headline change for many landlords is the creation of a separate set of tax rates for “property income”. These are set to be higher than the standard income tax bands for basic, higher and additional rates from 2027-28.
In practice, that means:
- If you hold property personally, more of your rental profit will be taxed at these higher property-specific rates.
- Section 24 still applies in full for individuals: you are taxed on gross rental income with a basic rate credit for mortgage interest, not on true profit after finance costs.
For landlords who are already close to higher-rate bands, this is a double squeeze: higher rates on income that may already feel “over-taxed” because of Section 24.
For limited companies, corporation tax rules still apply instead. Mortgage interest is normally treated as a business expense in the usual way, and the new property income bands do not directly apply to company profits (though they can bite when money is extracted personally via salary or dividends). That’s a major reason why more landlords are exploring limited company buy to let with their accountant.
Mansion tax / High Value Council Tax Surcharge
The Budget also confirmed a new style of annual surcharge from April 2028 on high-value homes. It is targeted at properties over a certain value threshold and collected through the council tax system.
For most mainstream buy to let investors, this is more background noise than direct hit:
- It targets a relatively small number of high-value properties.
- The broader housing and rental markets are expected to see limited direct impact.
For high-value London and HNW landlords, however, it becomes another line item to model when deciding whether to hold assets personally or via a company, and how to plan exits.
SDLT: the higher surcharge sticks
The 2025 Autumn Budget didn’t change stamp duty thresholds, but landlords are still living with the big SDLT shift that arrived previously:
- The higher rates SDLT surcharge on additional dwellings (second homes, buy to lets and residential company purchases) is now significantly higher than the standard bands.
This applies whether you buy in your own name or in a limited company, so using a company does not avoid the surcharge. For growing portfolios, these upfront tax costs are now a much bigger part of the return calculation, especially on lower yielding areas.
Does this Budget make limited company buy to let more attractive?
The short answer: for many higher rate and portfolio landlords, yes but not automatically, and not for everyone.
The Budget has:
- Increased the long-term tax drag on personal rental income (via higher property income tax rates).
- Left the core advantages of company ownership intact, notably the ability for companies to usually deduct finance costs in full as a business expense.
So the relative gap between personal and corporate ownership often widens over time, particularly if you:
- Are a higher rate or additional rate taxpayer.
- Carry meaningful mortgage debt across your portfolio.
- Plan to reinvest profits rather than withdrawing everything each year.
However, a company still brings:
- Higher mortgage rates and fees in many cases.
- Accountancy and compliance costs.
- More complexity around extracting money (salary, dividends, loans).
That’s why we are spending a lot of time with clients modelling net, after tax outcomes over 5, 10 and 20 years under both structures, not just comparing headline rates.
Limited company vs personal ownership in the 2025 landscape
When a limited company buy to let can make sense
In the current post Budget environment, a limited company buy to let mortgage can be worth exploring if you:
- Expect to be a higher rate or additional rate taxpayer on your rental profits in future.
- Intend to build or grow a portfolio, rather than keep a single, low geared property.
- Want to reinvest profits inside the company to fund further deposits and growth.
- Are planning family succession and want the flexibility of gifting or transferring shares.
- Have retained profits in another business that might be used (with advice) via director’s loans or inter company arrangements.
From a lender perspective, many of the strongest limited company buy to let options expect:
- A clean Special Purpose Vehicle (SPV) company with property related SIC codes.
- Directors and major shareholders giving personal guarantees.
- Deposits from around 20-25% upwards, with stress testing based on rental income and not just personal salary.
When staying in your own name can still be sensible
For some landlords, the added cost and complexity of a company may outweigh the benefits, for example if you:
- Are a basic rate taxpayer, even once rental income is fully factored in.
- Have low gearing (small or no mortgages) and don’t plan to expand.
- Expect to sell in the short to medium term, where CGT and SDLT on incorporation could be more painful than the long-term tax savings.
- Prefer simplicity and minimal administration.
These are exactly the sorts of questions we explore in an initial strategy call, and we encourage every client to bring their accountant into the conversation early.
Strategic questions landlords should ask after this Budget
First-time landlords – should you start in a limited company?
If you are about to buy your first rental, the Budget hasn’t removed personal buy to let as an option, but it has tilted the field slightly further towards corporate structures for those expecting to grow.
Useful questions to consider:
- Do you realistically see yourself owning more than one or two properties?
- Will your total income (salary, bonuses, rental) push you into higher-rate bands?
- Is this a long-term wealth-building strategy, or a short-term sideline?
For some first-time landlords, starting with a limited company can avoid having to “unpick” personal ownership later (and the SDLT/CGT friction that can come with transferring into a company). For others, it’s unnecessary complication. The right answer is highly individual.
Existing portfolio – incorporate, partially incorporate, or hold steady?
The Budget will push more portfolio landlords to revisit long-standing structures. Options include:
- Full incorporation – selling personally held properties to an SPV and refinancing on limited company buy to let mortgages.
- Hybrid or partial approaches – keeping some legacy stock personally, but doing all new acquisitions through a company.
- Restructuring debt – remortgaging existing company stock to release equity, fund deposits and manage cash flow.
Each path triggers different SDLT, CGT and finance implications. The SDLT surcharge increase and earlier company purchase changes make wholesale restructuring more expensive than in the past, so careful modelling is crucial.
Using retained profits and director’s loans
Another post-Budget theme we are seeing is directors looking to deploy surplus business profits into property:
- Lending money personally to the SPV as a director’s loan (to be repaid later).
- Considering whether their trading company should invest directly (which most buy to let lenders only accept in specific circumstances).
Lenders view director’s loans and inter-company funding differently, and the tax treatment can be complex (for example, rules on loans to participators, timing of dividend extraction and corporation tax).
Our role is to:
- Identify which lenders are comfortable with your proposed funding route.
- Structure the mortgage application in a way that aligns with how your accountant wants to set up the transactions.
How lenders are viewing limited company buy to let post-Budget
Criteria trends we are seeing
Across the lender panels we work with, some common themes are:
- Strong appetite for professional and portfolio landlords, particularly via SPV companies.
- Continued focus on rental stress tests, often using notional interest rates above current pricing.
- Green and higher EPC products becoming more important, especially where the property already meets EPC C or above.
- Manual underwriting for more complex structures (layered companies, family shareholders, mixed residential/commercial), where a well-packaged case and clear narrative can make the difference.
Cash flow, yields and geography
The Budget hasn’t changed the fundamentals of what makes a buy to let stack up:
- After higher SDLT and rising taxes, yield and long-term demand are even more critical.
- Many landlords are rebalancing portfolios towards higher-yielding regions rather than chasing capital growth alone.
- Lenders are often more comfortable where there’s a clear, documented business plan behind a limited company portfolio.
This is where a broker who understands both lender criteria and the commercial reality of being a landlord can add genuine value.
How The Mortgage Broker supports landlords after the Autumn Budget
For first-time landlords
- Plain English guidance on personal vs limited company structures (from a mortgage point of view).
- Help you understand deposits, stress tests and realistic borrowing levels.
- Support with your first buy to let mortgage for a limited company if that’s the route you choose.
For portfolio and professional landlords
- Strategic review of your existing borrowing, rates and structures.
- Access to a wide panel of specialist limited company buy to let lenders.
- Support with remortgaging, refinancing and restructuring portfolios, including SPVs and more complex company setups.
For business owners and directors
- Experience with cases involving director’s loans and retained profits.
- Close collaboration with your accountant on structure, documentation and lender presentation.
We combine digital speed (online tools, secure portal, e-signatures) with human specialists who understand landlords, regulation and lender appetite. There are no advice or upfront fees; our broker fee is only payable once a formal mortgage offer is secured – no mortgage offer, no fee.
Next steps: sense-check your structure and your mortgages
Whether you are:
- Considering your first limited company buy to let,
- Sitting on a personally owned portfolio and wondering if the Budget has tipped the balance, or
- An experienced investor looking to restructure debt and plan the next decade,
this is a sensible time to step back and review.
A typical free review with The Mortgage Broker will cover:
- How the Autumn Budget interacts with your existing structure.
- Pros and cons of limited company buy to let vs personal ownership for your situation (from a mortgage perspective).
- Lender options, indicative criteria and how stress testing may limit or enhance your borrowing.
- Clear questions to take to your accountant about tax, SDLT and any potential incorporation.
You can also explore our dedicated service page on limited company buy to let mortgages at themortgagebroker.co.uk for more detail on how a buy to let mortgage for a limited company works in practice, typical criteria and examples.
Your property may be repossessed if you do not keep up repayments on your mortgage.
Secured loans and buy to let mortgages are secured against your property.
FAQ’s Limited Company Buy to Let Mortgages:
Answered, by Fiona Simpson.
Book a Free Appointment with Fiona, Here
A limited company buy to let mortgage is a landlord mortgage where the borrower is a UK limited company rather than an individual. The company owns the property and receives the rent, and the directors or shareholders personally guarantee the borrowing. Lenders usually prefer simple “Special Purpose Vehicle” (SPV) companies that only hold and manage property.
For some landlords, especially higher-rate or additional-rate taxpayers with significant mortgage debt, a limited company can be more tax-efficient because mortgage interest is usually treated as a business expense. For others, the extra costs and admin of running a company may outweigh the benefits. The most suitable approach depends on your income, portfolio size and long-term plans, so it is important to take personalised tax advice alongside mortgage advice.
Most limited company buy to let lenders expect a deposit of at least 20–25% of the property value, with higher deposits often needed for more specialist properties or lower-yielding areas. The exact requirement depends on the lender’s criteria, the expected rental income and the strength of your overall position as a landlord or director.
Yes, some lenders will consider first-time landlords using a limited company, although criteria can be tighter and product choice may be more limited. Lenders will look closely at your personal income, credit history and the quality of the property and rental demand. A broker who understands which lenders support new landlords through SPVs can make this much easier.
It is possible to transfer personally owned rental properties into a company, but it is not a simple name change. In most cases the company is treated as buying the properties at market value, which can trigger both Stamp Duty Land Tax and Capital Gains Tax, as well as the need for new mortgages. Because the costs can be significant, you should model the numbers carefully with your accountant and use a broker experienced in limited company remortgages and portfolio restructures.
A Special Purpose Vehicle (SPV) is a limited company set up purely to hold and manage property, without any other trading activities. Many buy to let lenders prefer this cleaner structure. They typically expect the company to use property-related SIC codes (for example those covering buying, selling and letting of real estate) rather than general trading codes. We can work alongside your accountant to make sure the SIC codes and structure you use fit lender expectations.
For limited company buy to let mortgages, lenders usually focus on the property’s rental income rather than your personal salary alone. They use a “rental stress test” which checks whether the expected rent covers the mortgage interest by a set percentage. They will still look at the directors’ personal income, experience and credit history, but the rent is the main driver of how much the company can borrow.
Yes, many lenders will accept deposits funded by director’s loans or retained profits from another business, provided the source of funds is clear and properly documented. The tax treatment of those funds (for example whether money is taken as salary, dividends or left as a loan) needs careful planning. We help you understand how different lenders view these arrangements, then your accountant can advise on the most tax-efficient way to structure them.
Limited company applications can be more involved because lenders need to assess both the company and the people behind it. There may be more paperwork (such as company documents and personal guarantees) and product fees are sometimes higher. However, there is now a strong and growing market of lenders who specialise in limited company buy to let, especially for experienced or portfolio landlords. A good broker will package your case so underwriters can make a clear, informed decision.
Recent Budgets have generally increased the tax pressure on many individual landlords, for example through higher property income tax rates and continued stamp duty surcharges on additional properties. Limited companies are still typically able to treat mortgage interest as a business expense, so the relative position of company ownership remains attractive for some investors. The right structure for you will depend on your personal and business tax position, so coordinated advice from a broker and an accountant is essential.
There is no single right answer. Moving existing properties into a company can sometimes improve long-term tax efficiency, but it may also trigger SDLT, CGT and early repayment charges on your current mortgages. The decision depends on your current tax band, the size and gearing of your portfolio, and how long you plan to hold the properties. We can compare the mortgage options under both structures and help you build a set of numbers to review with your tax adviser before you commit.
We work with a wide panel of lenders that support limited company and SPV structures, from first-time landlords through to large portfolio investors. Our advisers understand how lenders view SIC codes, director shareholdings, background portfolios and more complex cases, and we coordinate with your accountant and solicitor where needed. You also benefit from ongoing support and 24/7 mortgage monitoring after completion, so you are not left on your own once the loan has completed.
Limited company buy to let in Scotland – what’s different after the latest changes?
If you own or plan to buy rental property in Scotland, the picture looks slightly different to England and Wales. Some rules are UK-wide, but others are set separately by the Scottish Government. That matters when you’re deciding whether to hold property personally or through a limited company.
Scottish income tax on rental profits
Income tax on most types of earnings and rental income for Scottish residents is set by Holyrood, not Westminster. The UK Government has announced higher, dedicated property income tax rates for individual landlords in England, Wales and Northern Ireland from 2027–28, but Scotland will decide in its own Budget whether to copy, soften or toughen that approach.
In practical terms:
- Scottish landlords who own property in their own name already face a different set of bands and rates to investors in England and Wales.
- Future changes to how rental income is taxed in Scotland will come through Scottish Budgets, even though wider UK policy is clearly moving towards higher taxation of personal landlords.
Limited company landlords in Scotland are still taxed under the UK corporation tax regime. Company profits and the treatment of mortgage interest remain broadly the same whether the underlying property is in Edinburgh, Glasgow, Aberdeen or elsewhere in the UK. The key differences sit around personal tax and property purchase taxes.
LBTT and the Additional Dwelling Supplement (ADS)
Scotland does not use Stamp Duty Land Tax. Instead, it has Land and Buildings Transaction Tax (LBTT) and an extra layer called the Additional Dwelling Supplement (ADS) on second homes and rental properties.
For Scottish buy to let and limited company purchases, this means:
- LBTT applies based on the Scottish bands for residential property.
- ADS is charged on top when you buy an additional dwelling, including most buy to lets and company/SPV purchases.
- The ADS rate is higher than the surcharge in England, which has a real impact on cash flow and yield calculations for investors.
Whether you buy personally or via a limited company, ADS can significantly increase the up-front cost of adding to your portfolio. That makes careful choice of location, price point and expected rent even more important for Scottish landlords.
Limited company vs personal ownership north of the border
The core trade-offs for Scottish landlords are similar to those elsewhere in the UK:
- Personal ownership is often simpler but can lead to higher ongoing tax on rental income, particularly for higher-rate taxpayers.
- Holding property in a company can improve the way finance costs and profits are taxed, but usually means higher purchase taxes, extra admin and more complexity around taking money out.
- Any move from personal to company ownership can trigger LBTT/ADS and Capital Gains Tax, so timing and long-term planning matter.
Where Scotland differs is the combination of:
- Different income tax bands and rates for individuals.
- A separate LBTT and ADS system with its own thresholds and percentages.
Those moving parts mean two landlords with very similar portfolios can face quite different outcomes depending on which side of the border they invest on and how they hold their properties.
How The Mortgage Broker helps Scottish landlords
We support clients with buy to let and limited company buy to let mortgages on properties across Scotland as well as in England and Wales. Our role is to:
- Explain, in plain English, how Scottish LBTT/ADS and lender criteria interact with different ownership structures.
- Compare personal and limited company mortgage options from a lending and cash flow point of view.
- Work alongside your accountant or tax adviser so the finance, tax and legal position line up correctly.
Whether you are considering your first rental in Scotland or restructuring an existing portfolio that spans different parts of the UK, it is worth taking time to look at the whole picture – not just the interest rate.
Talk to us about Scottish buy to letYour property may be repossessed if you do not keep up repayments on your mortgage.
Buy to let and secured loans are secured against your property.
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