Why this got harder recently
For years holiday lets had their own generous tax regime. It was abolished in April 2025, and they're now taxed like ordinary rental property. This stings if you own personally with a mortgage, because the interest only earns a basic-rate credit rather than coming off the profit in full. That one change is why the company question, once niche, now comes up in almost every first conversation we have.
Owning it yourself
Simple and cheap to run: no filings, no separate accounts, profits on your own tax return, and the widest choice of mortgages at the best rates. It suits basic-rate taxpayers, anyone buying without much borrowing, and couples who can split the ownership between them. The cost is that a higher-rate taxpayer with a big mortgage gives up a meaningful amount of profit.
Owning it through a company
A company deducts all of its mortgage interest and pays corporation tax on the profit, which is why heavily-borrowed, higher-rate buyers keep choosing it. The bill just arrives elsewhere: taking money out incurs dividend tax, company mortgages are dearer with fewer lenders, and there are accounts to file every year whether you made money or not which means accountants fees. It tends to suit people who'll reinvest profits rather than live on them, or who plan to build up more than one property.
- Moving a property into a company later counts as a sale — stamp duty and possibly capital gains, at full market value
- Which tax band you'll be in — this year and in five
- Whether profits will be spent or reinvested
- Who inherits, and how — companies can make sharing with family easier
Structure is easy to choose and painful to change. That's the whole reason to choose it early.
None of this is advice and the right answer rests entirely on your own numbers, and this is precisely the hour to spend with an accountant who knows short-stay property. We're not accountants and don't pretend to be, but we can sit in on the meetings and help you find an accountant to trust.