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  • Insurance

    Insurance! Flipping Property...

    Tribe! I've been flipping property in my personal name and so far have been managing with standard buildings insurance and notifying the insurer that a renovation is taking place and property is unoccupied.

    Under the advice of my accountant,I am now to continue doing this through a trading Ltd Company. Thats all been setup and first property under the new structure acquired. Question is..

    What insurance do I need to cover myself completely?

    Most of the contractors I use don't carry any insurance either which further complicates things, I don't want mountains of cover, but what I do need as a minimum is to insure the building if something were to happen to the structure due to myself, contractors or natural causes, and cover for myself if anything should happen after selling the property.

    I really am new to all of this operating as a company and I'm getting different responses depending on the broker I happen to be speaking to at the time.

    Please help!

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    I know every situation is different, but isn’t it more tax efficient to trade with your own name over a company for flipping property? 

    You’ll pay the 3% stamp duty surcharge whenever you buy a property via a company, though less capital gains (about 10% less).
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    if you are flipping CGT is not relevant..You are trading so are subject to income tax

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    In relation to insurance cover, firstly you must inform your broker or insurance company when a property is undergoing renovations. 

    Depending on the schedule of works, whether there is any structural works being carried out, timescales and costs will have an impact on the cover insurers will be prepared to provide. 

    You are taking a risk if you are using contractors who have no insurance in place for undertaking such work as faulty workmanship is a standard exclusion under all buildings insurance policies. 

    Alan Boswell Insurance Brokers Ltd have a range of policies that can be tailored to your needs, whether during renovation, periods of un-occupancy, let etc. so feel free to contact us on 01603 649736 where one of our team will be happy to assist.

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