Rent to Rent Tax

P

Property2022

New Member
Messages
8
Hi,

Can I setup a property company and 'rent to rent' my personal property? I.e. my company rents my property from me for 500 euros per month and my company rents out the property to a tenant for 1500 a month?

Thanks.
 
Why would you do that?

Do you know how difficult it is to get rid of a tenant?
Can you imagine how much more difficult it is for a company?

Do you understand the tax implications of having a company?

Do you understand the huge admin burden?

Brendan
 
I do know how hard it is to get rid of a tenant, why would it matter if the tenant was renting from me directly or via a company I own?

Yes I understand the tax implications, 55% personal Vs 25% (or lower corporation tax), with the ability to extract money from the company tax free through pension or reinvest in other assets.

Plus accounting fees, a couple thousand a year...
 
Property2022 said:
Hi,

Can I setup a property company and 'rent to rent' my personal property? I.e. my company rents my property from me for 500 euros per month and my company rents out the property to a tenant for 1500 a month?

Thanks.
Click to expand...
So the company pays 25% CT on the rental profit and you then pay income tax on the profit extracted from the company? What exactly is the point of this idea?
 
Leave the money in the company to reinvest in more property and / or pump money into a director's pension tax free (a large enough portion of which can be extracted in a lump sum when you retire)...
 
Property2022 said:
Leave the money in the company to reinvest in more property
Click to expand...
In that case, your company will be paying 45% corporation tax once the close company surcharge is included.
Property2022 said:
and / or pump money into a director's pension tax free (a large enough portion of which can be extracted in a lump sum when you retire)...
Click to expand...
Not allowed in respect of proceeds of rental income.
 
Property2022 said:
Thanks for that answer....Are there any ways to avoid the close company surcharges / additional taxes?
Click to expand...
Not really. There's a reason why you're having to ask these questions in the first instance - if it was workable, many more people would be doing it already.
 
You must log in or register to reply here.
Menu
Log in
Register