SPV Setup and First Property Purchase for a Higher-Rate Taxpayer
£215,000 · 25 years · 5.69% fixed 5 yrs. A higher-rate taxpayer with a professional salary of £95,000 had been advised by his accountant to purchase investment properties through a Special Purpose Vehicle (SPV) limite...
The Client
Higher-rate taxpayer
The Challenge
A higher-rate taxpayer with a professional salary of £95,000 had been advised by his accountant to purchase investment properties through a Special Purpose Vehicle (SPV) limited company to access full mortgage interest relief - no longer available to personal BTL landlords. He had never set up a limited company before and was unsure how to proceed.
Our Solution
Doulton co-ordinated the SPV incorporation with the client's accountant, ensuring the correct SIC code (68209) was used and that the company was structured appropriately for mortgage purposes. The first property was then mortgaged through the SPV. Doulton explained the full range of limited company lenders available - materially wider than many clients expect.
The Outcome
SPV incorporated and first BTL property purchased through the company. The client's accountant confirmed that the full mortgage interest is deductible against rental income within the company, providing significant tax efficiency at his marginal rate. Key highlights: SPV incorporation co-ordinated with client's accountant; Correct SIC code and structure confirmed for mortgage purposes; Full mortgage interest deductibility - major tax advantage at 40% rate.