In the world of property taxes the rules can be difficult to navigate.
One careless move can have ripple affects on a number of other taxes; the repercussions often not realised until far in the future!
Property Portfolio Structure Concerns
When speaking to property investor clients, it’s immediately clear that there’s two taxes in the forefront of their worries – capital gains tax and inheritance tax, however there’s stamp duty land tax to navigate around too!
A question that crops up repeatedly is “should I incorporate my property portfolio into a limited company?”
Whilst this can be a potential solution for some, for others there’s too many variables in the way, such as early repayment charges and the need to convince HMRC a bonafide ‘business’ activity exists.
Depending on your individual situation we may be able to suggest simpler alternative options to significantly reduce your tax burden.
How do we identify the right property portfolio structure for you?
As with most things in tax, the answer often is “it depends”!
We’re interested in hearing about your goals and future plans for your portfolio so we can give you the most accurate and tax efficient advice as possible.
- Where do you see yourself in 10 years?
- Do you want to triple your portfolio, retaining as much post tax cash to reinvest as possible?
- Or perhaps you’d like to focus on creating and maintaining wealth to pass down to your children – with inheritance tax currently at 40%, sound planning can save tens of thousands of pounds.
- For some of you, the goals may simply be to cash in on your investment and enjoy an early retirement!
No matter your situation, we have a team of personal tax, corporate tax, stamp duty land tax and inheritance tax experts to advise you on your journey.
What options are available?
There’s a range of option we can explore, including:
- Growth shares in a corporate structure, so any future growth in value of your property is attributed to your children, efficiently passing down wealth to future generations.
- Utilising the full potential of trusts and, depending on your age, gradually reducing the value of your estate for inheritance tax by making gifts into trust for your children.
- Rearranging tax affairs between spouses, making use of no gain/no loss transfers and deed of trust documents to effectively utilise tax allowances between couples
- Family partnership arrangements, where property maintenance activity is substantial enough to be deemed a business and we can allocate profits between family members in a more tax beneficial manner.
And much, much more!
Finding a solution
The solution really isn’t one-size fits all, our advice will be bespoke to your circumstances, aspirations and needs.
We will explore deep into your circumstances and produce a tailored report document outlining our suggestions and the options open to you.
We believe in transparency and making sure you fully understand the consequences of all choices so you can make an informed decision.
We’re dedicated to providing clear jargon-free advice, whilst ensuring you’re given the full details and guidance, so that you can feel reassured in the solutions we’re providing.
Our reports start at £500 + VAT – prior to commencement of work we arrange have a free, no-obligation discussion with you about your circumstances and provide you with a quote depending on the complexity for your situation.
We can also offer you advice relating to your general personal tax position and introduce you to software systems such as Xero to significantly reduce the time you spend on accounting administration for your portfolio.
Getting in touch with us about your property portfolio structure
It is never too early or too late to take proactive steps to limit your tax burdens. Whatever stage of life you’re at we can help you implement solutions to save you money.
If you’re a property investor, concerned about reducing your tax bills, then please get in touch.
Help us to understand your goals and in turn we can help you to save tax, save time and create wealth.
If you would like to find out more, please contact Christie Inns or Darren Hughes . Alternatively, give us a call on 01634 731390
If you would like to find out more about some of our services that might help you please take a look at our related pages:
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The content in this blog is correct as at 07/06/2023 See terms and conditions.