acproperty Posted February 4, 2009 Report Share Posted February 4, 2009 Dear all, I have approached quite a few accountants with this one and cannot get a satisfactory answer to the following advice Sale & Leaseback of your property assets. I have found this in one of my property manuals and would appreciate your comments. it states. When you have portfolio of properties you have a lot of assets beds, washing machines fridges etc. so 1:- Sell all of these to a limited company and then buy any further assets through this company. 2:- Lease these items back to your property company 3:-Pay 20% of the asset value as rent per annum 4:-Assume the asset has a life span of 5 years The benifits of this action are claimed as the following 1:- The amount you pay your company in rental is tax deductable and reduces your personal tax liability 2:- When you buy through the company you can claim capital alowances which you cannot do as an individual 3:-Corporation tax on rental income is less than personal tax rates 4:- Your 10% wear & tear allowance for letting furnished dwellings is not affected if all of this is followed you are able then for every £1,000 spent on assets it will only cost you £300 I would appreciate any comments on this, I own 5 properties and have spent approx £15,000 on assets ( I convert to HMO and studio flats) and I also run a limeted company in a different field to the property business many thanks in advance alan wetherall Link to comment Share on other sites More sharing options...
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