Selling your Property into a Company - The Numbers - An example calculation

[@areyoutryingtosay]

Don't get me wrong, I love the videos and it's great you're sharing this information. I know you're trying to keep it simple, but the cost of the transfer is £180 for the individual, but there is also the other £9k paid by the company for SDLT and legal fees, it's just that you're using finance to pay for it. Sadly the benefits are also minimal as most people don't factor in the interest rate difference between btl as an individual vs a ltd company

[@kimberleyshapcottpropertytax]

Thanks for raising an important point. Everyone will be looking at their reasons differently so it will be based on everyone's individual circumstance whether it is worthwhile to make the transfer or not. Any stamp duty that is paid will be an allowable cost when sold in the future however as you say it will be a cost and will increase mortgage payments if added onto any mortgages.

[@GloUp100]

Hey Kimberley, sorry still learning here and find your videos very educational thank you. Question pls, If I have my only residential property with no mortgage and sell to my ltd company, as the only equity I have is in the property can I use that “virtual” money to buy from my company. Or would I physically need to have the full amount in my company bank account to make the purchase if I don’t get a mortgage. So I won’t have physical money on the company end. but Sorry for the way I’ve worded it. Hope it makes sense ?

[@kimberleyshapcottpropertytax]

If you are selling from yourself to a company a balance can be placed onto a Directors loan account rather than having physical cash in the bank. Everything will need to be done with the Land registry and solicitors to ensure any transfers are legal. If you are getting lending then you may need to make appropriate statements to the lenders and solicitors that this is what has happened.

[@johnporcella2375]

Just the one queation. Could you explain why it may be possible to claim back the extra Stamp Duty?

[@kimberleyshapcottpropertytax]

As most individuals will be buying a more expensive property in their own name they will be paying an additional 3% on their personal property. When the property is sold into the company, this 3% can be reclaimed by the individual as long as it is within 3 years. The stamp duty paid by the company will be an allowable expense when the property is sold in the future. Check out the video on reclaiming your stamp duty for the eligibility criteria and how to do it on the channel.

[@sle-m7f]

Hi, just want to check - the CGT BR amount is shown as £180 - is this assuming a CGT AE of £3k which starts from 06 Apr 24? (and following recent budget announcement, a reduced higher rate of 24%, also starts from 06 Apr 24)

[@kimberleyshapcottpropertytax]

The assumptions have used £3000 annual allowance as this is the one that is known about. As the calculation is before the budget the higher rate in the example is at 28%. To calculate your figures you would just need to check what the rates are at the time of completing the calculations.

[@adeel5762]

Hi Dear - I have a question please. I want to transfer my existing home (I’m living in it since bought) to my existing Pvt Ltd company (that’s my business too) and let it out. I want to buy a new house and move my family. My company has the funds in business account- since my personal earnings source is my business, I need same funds to purchase new house too. How in this situation I can use company funds to buy new house and at the same time company to buy my existing house please?

[@kimberleyshapcottpropertytax]

It sounds like your company will need to buy your house on a mortgage to then pay yourself which will provide the funds to buy your new house. It looks like it will be possible and will simply be a matter of timing of the different transactions so they all line up.

[@KingKong-rb6xj]

Thanks for this great video! I'm considering letting out my current residential property and purchase another one to live in. Lived in there for 7 years , and value has gone up by 150k. If I sell in about 12 months of letting does that mean the CGT taxable amount is 15k (10k of 150k)? Which is the 10%

[@kimberleyshapcottpropertytax]

You will have the 9 months after you move out therefore there will only be 3 months of the entire ownership that would be taxable and you will have your personal capital gains tax allowance of £3,000. If it is owned jointly that will be double. Depending on the value that it has increased by it should minimise any capital gains tax payable.

[@kiranshrestha2657]

I have moved out of my residential property about a year ago and kept it as an investment property. Now can sell it to my own company? Will I be able to claim back stamp duty of my current residential property?

[@kimberleyshapcottpropertytax]

You will indeed. A video will be coming on the channel in the next few weeks about reclaiming your stamp duty.

[@pearlcodjoe6751]

Could you please share a copy of the spreadsheet? Thank you

[@kimberleyshapcottpropertytax]

Unfortunately as I plug numbers in and play with formulae the spreadsheet is not in a fit state to share I'm afraid.

[@555shaaz]

Hi Kimberley Thank you so much for these tips. I have a question slightly similar to this scenario, can you short-term rent a property that your company owns? Let's say your company owns a property in Devon, and for 4 months a year, you want to stay in it while working remotely. Is this allowed legally?

[@kimberleyshapcottpropertytax]

Yes you can, however to remove any benefits in kind you will need to charge yourself a fee for stopping in the property. If you don't charge the market value then there is a benefit to you which will then need to be reported on a P11d form.

[@555shaaz]

@kimberleyshapcottpropertytax thank you so much Kimberley ❤️

[@Bljmbbs]

Hi. Amazing content. Am I right in thinking If it’s the first property for the company and the property value is £250k then the stamp duty is zero according to current rates? Thanks.

[@kimberleyshapcottpropertytax]

Unfortunately not. You will always pay the additional 3% when buying in a company.

[@Andy-si1pl]

I want to do this but my company needs a deposit to get a mortgage right?

[@kimberleyshapcottpropertytax]

You can usually do a gifted deposit when you are selling to your own company which means there is no money needed except for your new house.

[@benjaminde-veer3912]

Hi great video very useful any chance you could share your excel spreadsheet? very much appreciate it

[@kimberleyshapcottpropertytax]

As these things change and are constantly evolving. I don't have a spreadsheet at present that I can share.