The increasingly popular limited company ownership structure for BTL properties is not risk-free, Purbeck Insurance Services has warned landlords.
The warning comes after Hamptons found 5,312 new limited companies were established for BTL purposes in September 2024 alone. This was 28% more than in any previous September.
Todd Davison, managing director at Purbeck Insurance Services, concedes there are tax benefits for this nature but highlights landlords’ assets are not completely removed from such risk.
Here, Todd explained that when mortgaging or remortgaging a limited company director will still need to sign a personal guarantee.
“This would put their personal assets such as their family home and savings on the line if for some reason they could not meet the mortgage payments,” said Todd. “It’s a worrying time for BTL landlords but there are steps they can take to minimise some of the risks."
