Limited Company Buy-to-Let Mortgage Rates September 2026 — SPV vs Personal
- Rate premium for limited company BTL vs personal BTL (same LTV)
- 0.10%–0.50%Rate premium for limited company BTL vs personal BTL (same LTV)
- Personal landlords: 20% tax credit only on mortgage interest — key driver for Ltd company
- Section 24Personal landlords: 20% tax credit only on mortgage interest — key driver for Ltd company
- Corporation tax rate (most Ltd company landlords) vs 40%/45% income tax
- 25%Corporation tax rate (most Ltd company landlords) vs 40%/45% income tax
- Special Purpose Vehicle — dedicated property holding company, most lenders require
- SPVSpecial Purpose Vehicle — dedicated property holding company, most lenders require
Limited company buy-to-let mortgage rates in September 2026 carry a premium of approximately 0.10%–0.50% above equivalent personal BTL rates. On a £200,000 BTL mortgage, that premium costs £100–£500/year in additional interest. For higher-rate taxpayers, the Section 24 restriction on personal mortgage interest deductibility means the tax saving from using a limited company typically far exceeds this rate premium — making company BTL the financially dominant structure for most landlords paying 40%+ income tax. For basic rate taxpayers, the rate premium may outweigh the tax saving, and personal ownership may be more cost-effective.
Limited Company BTL Mortgage Rates — September 2026
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| LTV | Personal BTL 2yr fix | Ltd company BTL 2yr fix | Rate premium | Ltd company 5yr fix | Named lenders (Ltd company) |
|---|---|---|---|---|---|
| 65% LTV | ~3.90% (Molo Finance est.) | ~4.00%–4.20% | +0.10%–0.30% | ~3.85%–4.05% | Landbay, Foundation Home Loans, Paragon |
| 70% LTV | ~4.20% (various) | ~4.35%–4.55% | +0.15%–0.35% | ~4.20%–4.40% | Landbay, Foundation, Keystone, Precise |
| 75% LTV | ~4.50%–5.44% (avg) | ~4.65%–5.65% | +0.15%–0.50% | ~4.55%–5.50% | Foundation Home Loans, Landbay, Paragon, Together |
| 80% LTV | ~5.50%+ (specialist) | ~5.70%+ (specialist) | +0.20%–0.50% | ~5.60%+ | Specialist panel only — fewer lenders at 80% LTV Ltd company |
| HMO (Ltd company, 75% LTV) | ~5.40%–5.80% | ~5.60%–6.00% | +0.20%–0.40% | ~5.50%–5.90% | Paragon, Landbay, Foundation — specialist HMO Ltd company panel |
What determines your rate
Section 24 and the case for limited company BTL
From April 2020, personal landlords paying income tax at 40%+ can only claim a 20% tax credit on mortgage interest — not deduct the full interest from rental income. A higher-rate taxpayer receiving £18,000 gross rent and paying £10,000 mortgage interest receives only a £2,000 tax credit (20% × £10,000) rather than the pre-2017 deduction worth £4,000. A limited company pays corporation tax at 25% and can deduct the full mortgage interest. For a landlord with a £200,000 interest-only BTL mortgage at 5.44% — paying £10,880/year interest — the Section 24 difference is approximately £2,176/year in additional tax versus a company structure. The rate premium of 0.30% on £200,000 costs £600/year. The tax saving far exceeds the rate premium.
SPV vs trading company
Most BTL mortgage lenders require a Special Purpose Vehicle (SPV) — a limited company whose sole purpose is to hold property. They typically accept SIC codes 68100 (buying and selling of own real estate), 68201 (renting and operating of owned or leased housing), or 68209 (other letting and operating of own or leased real estate). Trading companies (that also conduct other business activities) face a much narrower lender panel and often cannot access standard BTL company mortgage products.
Director guarantees and personal liability
Almost all limited company BTL mortgages require a personal guarantee from the director(s). This means the director is personally liable for the mortgage if the company defaults. The limited liability protection of the company structure does not fully shield the director from mortgage liability. This is not a reason not to use a company — the tax benefits typically still outweigh the premium — but it should be understood before proceeding.
ICR stress test for limited companies
Most limited company BTL lenders apply an ICR (interest coverage ratio) of 125% at a 5.5% stress rate for basic rate taxpayers in a company structure. Some lenders use 145% for companies. The rental income must cover 125%–145% of the stressed annual interest. On a £200,000 company BTL mortgage at 5.5% stress: annual interest £11,000. Required rent at 125%: £1,146/month. Required rent at 145%: £1,329/month. DBF calculates ICR before any BTL application.
Worked cost example
- Rate premium cost
- £444/year vs personal BTL at 5.44%
Higher-rate taxpayer (40% income tax). Buying £280,000 BTL property. 25% deposit: £70,000. Mortgage: £210,000.
Personal BTL at 75% LTV, 2yr fix
Rate: 5.44%. Monthly interest: £952. Annual interest: £11,424.
Net rental income after Section 24: taxed at 40% on rental income less 20% credit on interest.
Effective additional tax vs company: ~£2,285/year (illustrative — depends on personal tax position).
Limited company BTL at 75% LTV, 2yr fix
Rate: 5.65% (Foundation Home Loans). Monthly interest: £989. Annual interest: £11,868.
Corporation tax (25%) deducts full mortgage interest. Net tax advantage vs personal: ~£2,285/year.
Net saving from company structure after rate premium: ~£1,841/year.
Company structure wins by approximately £1,841/year for this higher-rate taxpayer.
For basic rate taxpayer (20%): tax saving approximately £0 (20% credit = 20% corporation tax). Rate premium is pure cost. Personal structure may win.
Rate context and outlook
DBF arranges limited company BTL mortgages for new and existing property portfolios. The decision between personal and company ownership is primarily a tax question — DBF advises on the mortgage implications and recommends that clients take independent tax advice before restructuring. Our lender panel for SPV BTL includes Landbay, Foundation Home Loans, Paragon, Keystone Property Finance, Precise Mortgages, and specialist portfolio lenders.
Frequently asked questions
Are limited company BTL mortgage rates higher than personal BTL?
Yes — typically by 0.10%–0.50% at the same LTV. On a £200,000 mortgage, this premium costs approximately £200–£1,000/year. For higher-rate taxpayers, the tax saving from the Section 24 restriction difference typically exceeds this premium significantly. For basic rate taxpayers, the calculation is closer and personal ownership may be more cost-effective.
Which lenders offer limited company BTL mortgages?
The main lenders for limited company SPV BTL in September 2026 include Landbay, Foundation Home Loans, Paragon, Keystone Property Finance, Precise Mortgages, and Together. Most lenders require the company to be an SPV with specific SIC codes related to property rental. Trading companies face a much narrower panel.
Do I need a personal guarantee for a company BTL mortgage?
Almost all limited company BTL mortgage lenders require a personal guarantee from the director(s). This makes the director personally liable for the mortgage. The limited liability of the company does not fully shield the director from mortgage liability. This is standard practice and should be understood before taking a company BTL mortgage.
Is it worth using a limited company for buy-to-let in 2026?
For higher-rate (40%+) and additional-rate (45%) taxpayers, the tax saving from the Section 24 restriction difference typically outweighs the rate premium. For basic rate taxpayers, the calculation is much closer. The right answer depends on your specific income, existing BTL position, and long-term portfolio intentions. DBF advises on the mortgage structure and recommends independent tax advice before any restructuring decision.
Can I transfer my existing BTL from personal to company ownership?
Yes — but this typically involves selling the property from yourself to your company at market value, triggering SDLT, Capital Gains Tax, and potentially other costs. The costs of transfer often outweigh the benefits unless the property has minimal gain. Most landlords using company structures start new acquisitions in the company rather than transferring existing properties. DBF can model the cost of transfer for your specific portfolio.
Get a personalised rate comparison for your case
Independent whole-of-market advice · FCA No. 814533