Transferring a Portfolio to Limited Company
Transferring a Portfolio.
If you are an investor who currently owns a portfolio in their personal name, you should be aware of the potential benefits of transferring a portfolio to a LTD Company.
What is the main benefit of transferring a portfolio? Simply put, it is far more tax efficient. If you are someone with a sizable portfolio, you may be paying income tax on your profits at a rate of 40%, as opposed to the current corporation tax rate of 19% if these were to be owned in a LTD Company. This allows you to retain more profits, re-invest and grow the portfolio as you desire in a far more efficient manner.
You may be pondering the inconvenience of Capital Gains Tax (CGT) or Stamp Duty Land Tax (SDLT) when considering transferring a portfolio over to a LTD Company. However, if you are someone with a portfolio of 6+, a portfolio transfer can be done free of CGT and free of SDLT.
SDLT in Scotland (ADS tax) is a 4% surcharge, whereas South of the border it is around 3%. On a portfolio worth £1m, you can save £30,000-£40,000 in SDLT, not to mention avoiding CGT at 18%, or 28% for a higher rate taxpayer.
Retaining far more of your profits allows for a portfolio with faster growth potential, whilst saving tens, potentially hundreds, of thousands in tax charges. So, what are you waiting for?
Do you have 6+ properties in your personal name? Are you interested in retaining more profits to grow your portfolio faster than before?
IT'S GOOD TO TALK
Submit our online Client Enquiry Form or contact the team today on Tel: 0800 774 7045.