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05 April 2016
Can landlords benefit from a partnership to mitigate interest relief changes?
We have numerous clients who run buy-to-let portfolios as their main source of income and are considering the benefits of forming partnerships. The idea is that potentially this would enable them to use the benefits of incorporation relief to transfer their businesses to limited companies to mitigate the mortgage interest relief changes in 2017. However there are several questions
as follows.
- Would class 2 and 4 National Insurance contributions be payable?
- Would there be any stamp duty land tax on a future incorporation?
- Is there any clearance procedure to establish that the trade is a partnership? For example if someone has a part-time employment and ten buy-to-let properties would they qualify as opposed to someone with no employment or would neither?
We would welcome readers’ comments.
Query 18 754– Landlord.
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