Buy-to-let lending to limited companies soared by 47% in the first quarter of 2016, higher than the total for the whole of 2015 as landlords tried to lessen the impact of the Governments tax hikes. A report from Kent Reliance found the 3% stamp duty surcharge led to a 176 per cent increase in buy-to-let purchases in March, while the number of loans issued to limited companies doubled in 2015. Limited company mortgages could be within touching distance of 100,000 in 2016 as landlords reacted to tax changes. Borrowing through a company structure means investors are taxed on profits at lower corporation tax rates and can offset all finance costs against rental income. Landlords looking to add to their buy-to-let portfolios before the 1 April deadline increasingly used a limited company to get round the tax changes. In the first three months of this year 38,000 loans were issued to limited companies, nearly four times the number issued in the same period in 2015. The research also revealed re-mortgaging activity has risen faster than purchase activity as borrowers look to take advantage of increasingly attractive fixed rates. March saw re-mortgaging up by 63 per cent year-on-year. Need some help? If you require assistance with your new or re-mortgage please do get in contact with one of our fully qualified advisers who will be happy to help.
