Should your rental properties move into a company?
A company gets full relief on mortgage interest, but moving your homes into it is a sale at market value. See the yearly saving, the one-off cost, and how long it takes to pay back.
Your answer
Enter your rent, your other income and what the homes are worth.
About this calculator
For one landlord who owns the homes alone, in England or Northern Ireland.
We don't give mortgage advice: ask your lender what a new company mortgage would cost.
What happens to your answers
We don’t keep them. Your answers go to our server to do the sums and aren’t stored or logged. If you copy a link to your answers, they’re in the link itself, so only share it with people you trust.
How it’s worked out
Personally, rental profit is taxed on top of your other income, and mortgage interest only gets 20% relief. In a company, all the interest comes off before Corporation Tax (19% to 25%), and you pay dividend tax on what you take out.
Moving the homes in is a sale at market value. You pay Capital Gains Tax on the gain, and the company pays stamp duty on the value, with the 5% extra for companies. Incorporation relief can put off the Capital Gains Tax, but only if your letting is a real business, which most landlords' isn't. We divide the one-off cost by the yearly saving to show how long it takes to pay back.
Worked example
In a company, taking all the profit out, you'd pay £1,465 a year less tax, but moving costs about £75,280, so it takes about 51.4 years to pay back.
2026/27 rates · England or Northern Ireland · one owner · 2 homes · taking all the profit out · no incorporation relief
| Rent a year | £30,000 |
|---|---|
| Less costs (not mortgage interest) | − £4,000 |
| Rental profit | £26,000 |
| Personally: income tax on it, on top of your other income | £10,400 |
| Less mortgage interest relief at 20% | − £2,400 |
| Tax a year if you keep them | £8,000 |
| In a company: profit after all mortgage interest | £14,000 |
| Corporation Tax (19%) | £2,660 |
| Taken out as dividends | £11,340 |
| Dividend tax (first £500 tax-free) | £3,875 |
| Tax a year in a company | £6,535 |
| Market value of the homes | £500,000 |
| Less what you paid for them | − £350,000 |
| Gain | £150,000 |
| Tax-free allowance | − £3,000 |
| At 24% | £147,000 |
| Capital Gains Tax | £35,280 |
| Stamp duty at the standard rates on the market value | £15,000 |
| Plus 5% because a company is buying | + £25,000 |
| Stamp duty | £40,000 |
| One-off cost of moving | £75,280 |
| Years to pay back: £75,280 ÷ £1,465 a year | 51.4 |
Worked out using HMRC's 2026/27 rates for income tax, dividends, Capital Gains Tax and stamp duty, and Corporation Tax for the financial year from 1 April 2026.
Questions people ask
Can I avoid the Capital Gains Tax with incorporation relief?
Only if your letting is a business, not just owning homes and collecting rent. HMRC's guide is 20 hours a week or more of work on it. From 6 April 2026 it has to be claimed. We can check whether yours qualifies.
What if the company can't pay me for the homes?
The company can owe you the price. Paying that debt back to you later isn't taxed as income, but the tax on moving is still due.
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