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Buy To Let Landlords: What Is The Beneficial Interest Company Trust?

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A recent article in a daily paper has made some waves. The article concerned what has been described as a controversial tax manoeuvre, under which a property portfolio that was subject to mortgages could be transferred to a Limited Company without having to rearrange all of the mortgage finance.

The reason landlords may want to put property portfolios into Limited Companies is simple, Companies are not subject to the restrictions on loan interest relief. This starts being phased in from 6 April 2017.

It is not certain whether it is permissible legally to transfer the beneficial interest, but not the legal interest to a company. Legal advice must be sought on this. Other ways should be considered when mitigating the tax effects of the new mortgage interest disallowance. Please contact Alextra if you would like to review.

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