Limited Company vs Personal Name for Buy-to-Let Mortgages

If you’re planning to invest in rental property, one of the first big questions is: should I buy through a limited company or in my own name?

It’s a decision that affects everything from how much tax you pay to which lenders you can use — and it’s one we help landlords with every week at Mortgage Bridge.

Both routes have their benefits, and the right choice depends on your goals, income, and long-term property plans. So, let’s break down how each option works, what lenders look for, and which might make the most sense for your situation.

What’s the Difference Between a Limited Company and Personal Buy-to-Let?

A personal buy-to-let mortgage means you’re buying and owning the property in your own name. You’ll be personally responsible for the mortgage, and the rental income will count as part of your personal earnings for tax purposes.

A limited company buy-to-let mortgage, on the other hand, means you’re buying the property through a business — usually a “special purpose vehicle” (SPV) set up specifically for property investment. The company owns the property, and the income goes through the business rather than directly to you.

So the key difference is ownership: you own the property personally in one case, while your company owns it in the other.

Why Are So Many Landlords Using Limited Companies?

Over the past few years, we’ve seen a major shift toward landlords using limited companies for buy-to-let properties. The main reason? Tax efficiency.

In 2017, the government changed the rules around mortgage interest tax relief. Individual landlords can no longer deduct their full mortgage interest costs from rental income before paying tax — instead, they receive a flat 20% credit.

That means higher-rate and additional-rate taxpayers now pay more tax on their rental profits than before.

Limited companies, however, can still treat mortgage interest as a business expense. They pay corporation tax (currently 25%) on profits after costs, rather than income tax on the full rental income.

For many landlords, especially those with multiple properties or higher personal incomes, this structure can result in significant tax savings over time.

How Do Lenders Treat Limited Company and Personal Buy-to-Let Mortgages Differently?

Most mainstream lenders focus on personal buy-to-let mortgages. However, in recent years, more and more lenders have introduced limited company products — often with very similar rates and criteria.

The key differences are:

Lender pool: Fewer lenders offer limited company products, but the number is growing fast.
Rates and fees: Company mortgages can carry slightly higher interest rates or arrangement fees.
Underwriting: Lenders assess the directors and shareholders personally — they’ll check your credit history and income even if the property is held in the company’s name.
Stress testing: Limited company mortgages often use lower stress test rates, meaning they can allow higher borrowing than personal ones.

If you’re a basic-rate taxpayer or buying just one property, the personal route may still make sense. But if you’re planning to grow a portfolio, the limited company route can unlock more flexibility and scalability.

What Are the Tax Differences Between Personal and Limited Company Buy-to-Let?

Let’s look at this side by side.

Personal Name Buy-to-Let

You pay income tax on your rental profits (after allowable expenses).
Mortgage interest relief is capped at 20%, even for higher-rate taxpayers.
Profits are added to your overall income, which can push you into a higher tax bracket.
Capital gains tax applies when you sell (up to 28% for higher-rate taxpayers).

Limited Company Buy-to-Let

You pay corporation tax on profits (currently 25%).
All mortgage interest is deductible as a business expense.
You can draw income via salary or dividends, giving you control over when and how you’re taxed.
Capital gains are taxed at the corporation rate, usually lower than personal CGT.

While the limited company route often means lower tax on profits, it can also involve extra costs — like setup fees, accounting, and potentially double taxation if you take profits out of the company.

That’s why it’s worth chatting with both us and your accountant before deciding which structure is more beneficial for your situation.

Is It Harder to Get a Limited Company Buy-to-Let Mortgage?

Not really — but it does require a bit more admin.

You’ll need to set up an SPV limited company, usually registered under specific property-related SIC codes (like 68100 for buying and selling real estate). This tells lenders that your company exists purely for property investment.

Once your company is set up, the application process works much like any other mortgage: lenders assess affordability, property details, and your background as a director or shareholder.

The good news is that you don’t need trading history or business accounts for an SPV — even a newly formed company is fine.

We handle these applications all the time and can guide you step by step, from company setup through to mortgage approval.

Can You Move an Existing Property into a Limited Company?

Yes, but it’s not always simple.

Transferring a property from your personal name to a limited company is treated as a sale for tax purposes, meaning you’ll pay:

Stamp Duty Land Tax (SDLT) — including the 3% surcharge for additional properties.
Capital Gains Tax (CGT) on any increase in value since you bought it.

That’s why most landlords set up a limited company before purchasing, rather than moving properties over later.

If you already have a portfolio and want to explore transferring it, we can help assess whether the long-term benefits outweigh the immediate costs.

How Much Deposit Do You Need for a Limited Company Buy-to-Let?

Whether you’re buying personally or through a company, the deposit requirements are similar — typically 25% of the property’s value.

Some lenders may accept 20%, but most prefer a 75% loan-to-value (LTV) cap.

Company mortgages might need slightly larger deposits if you’ve got a limited track record or if the property is considered higher risk (like an HMO or flat above a shop).

We’ll help you find a lender that balances competitive rates with reasonable deposit terms.

Can You Use Your Personal Income to Support a Limited Company Application?

Yes — many lenders allow what’s known as “director’s guarantee” underwriting.

Even though the company technically owns the property, lenders often want reassurance that the directors can step in if the company can’t make repayments.

So they’ll assess your personal income, employment, and credit score — just like a personal buy-to-let application.

This makes it easier to get approved even if your company is new or has no trading history.

Which Option Offers Better Long-Term Growth for Landlords?

If you’re thinking about owning just one or two rental properties and you’re a basic-rate taxpayer, buying in your own name might be the simplest route. You’ll have fewer admin costs and direct access to your profits.

But if you’re planning to build a larger portfolio, reinvest profits, or are already paying higher-rate tax, a limited company is often the smarter long-term choice.

It allows you to:

Reinvest profits without drawing them out (and without paying extra tax).
Add family members as directors or shareholders.
Potentially pass on properties more tax-efficiently in the future.

We help clients design strategies around both approaches — and sometimes even a hybrid structure where personal and company-owned properties coexist.

What Are the Pros and Cons of Each Option?

Here’s a quick summary to help you compare:

Buying in Your Personal Name

✅ Easier to arrange
✅ Wider lender choice
✅ Slightly lower rates and fees
❌ Limited tax relief
❌ Higher income and capital gains tax
❌ May affect personal affordability

Buying Through a Limited Company

✅ Full mortgage interest tax relief
✅ Lower corporation tax on profits
✅ Easier to scale up and reinvest
❌ Slightly higher mortgage rates
❌ More admin and legal costs
❌ Possible double taxation on dividends

The right choice depends on your goals — not just now, but where you see your property journey in five or ten years.

How Can Mortgage Bridge Help You Decide?

Choosing between a personal or limited company structure can feel overwhelming — especially when tax, mortgage rates, and legal setup all come into play.

At Mortgage Bridge, we:

Compare your borrowing potential under both structures
Recommend lenders based on your income, property, and future goals
Work with your accountant to ensure the most tax-efficient approach
Handle all the paperwork and lender requirements for SPV setups

Whether you’re buying your first rental or expanding your portfolio, we’ll make sure your buy-to-let mortgage is structured smartly from the start.

Final Thoughts: Which Route Is Right for You?

There’s no universal “best” way to buy a rental property — but there is a best way for you.

If simplicity and low setup costs matter most, buying in your personal name can work perfectly well.
If you’re building for the long term, aiming for higher profits, or planning multiple properties, a limited company structure might be more efficient and flexible.

We’ll help you weigh up the numbers, understand the tax and lending implications, and move forward with clarity and confidence.

If you’d like to explore your buy-to-let options, let’s talk it through — we’ll help you find the right structure, lender, and strategy for your goals.

Limited Company vs Personal Name for Buy-to-Let Mortgages: Which Is Better for You?