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  • Tax

    First HMO tax question

    Hi,

    I'm just about to purchase my first buy to let, and my question is, should I set up a limited company and buy through it, or should I just buy

    in my own name? It would be my only source of taxable income besides maintenance from my ex..

    Thanks in advance : )

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    have you spoken to an accountant or tax advisor yet?

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    As others have said to answer that question, it first starts with an accountant to see which is the best route forward for you.
    Though that being said - you may find it hard to obtain a Buy-to-Let Mortgage without any income.

    https://bespokefinance.info/buy-to-let-m...mum-income

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    _________________________________________________________________________


    My posts are not financial advice, just a rambling guy passing time on a coffee break.
    The team at Bespoke Finance offers advice, including Limited Company Buy-to-Let , HMO Conversion and Cheap Life Insurance.

    _________________________________________________________________________


    Thorough homework needed here (Accountant/Tax Advisor) as just running a Ltd Co has regular annual costs eg Accountants needs to file returns with Company House and of course Corporation Tax is payable on net profits.

    As you personally are a separate legal entity to "the Company" - you also need a Company Bank Account which has annual fees attaching.

    Most importantly you need to understand the taxation of monies paid to you by "the Company".

    Even more crucially - unless you are already an experienced Landlord - running an HMO is likely to be very trying given the multiple extra complexities vs a single let to a family - plus frequent Tenant turnover etc. The extra yield comes at a cost in hassle terms - and crucially it is not a passive investment by any means.

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