How to Set Up a Property Investment Company: Step-by-Step UK SPV Guide

More and more UK landlords are choosing to set up a property investment company to hold their rental portfolios. With the Section 24 mortgage interest restriction now fully in force for individual landlords, and separate, higher rates of income tax on personal property income arriving in 2027, a company can be a more tax-efficient home for a growing portfolio that is being reinvested rather than drawn down.

Almost all of the work happens before anything is filed. The company name, the SIC codes, the number and class of shares, the people named as directors and as persons with significant control: each is a field on one online form, each takes seconds to enter, and each is awkward, sometimes expensive, to change once the company exists. What follows is the sequence in order, from testing whether a company suits you at all, through the Companies House filing field by field, to the point where rent can land in a company bank account. The company being formed here is a brand-new one, usually called a special purpose vehicle (SPV); our SPV company hub sets out the wider case for the structure.

Should you set up a property investment company at all?

Before any paperwork, work out whether incorporation is right for your situation, because a company is not automatically better. The case for setting up a property investment company is strongest when:

• You are a higher-rate or additional-rate taxpayer and the Section 24 restriction is costing you relief. Individual landlords no longer deduct mortgage interest from rental profit; they receive only a 20 per cent basic-rate tax reducer instead. A company deducts mortgage interest in full as a business expense, so geared portfolios are hit harder personally than inside a company. Our Section 24 complete guide explains the restriction in detail.
• You are reinvesting profits rather than living off them. A company pays Corporation Tax on rental profit and you only pay a second layer of personal tax when you extract money. If profits stay in the company to buy the next property, that deferral is valuable. If you need every pound of rent as income, the double layer can wipe out the benefit.
• You are building for the long term or for the next generation. Shares are far easier to gift or restructure than legal title to property, which makes succession planning more flexible.

The case is weaker for a small, low-geared, or already-mostly-paid-off portfolio, or where you are a basic-rate taxpayer who is not affected by Section 24. For a side-by-side of the personal versus company position, see our guide to whether Section 24 or incorporation saves more tax, and our complete guide to buy-to-let limited companies for the wider operating picture.

How a property company is taxed, in brief

A property company pays Corporation Tax on its rental profit. The headline figures for 2026/27 are:

• 19 per cent small profits rate on profits up to £50,000;
• 25 per cent main rate on profits above £250,000;
• 26.5 per cent effective marginal rate on the slice of profit between £50,000 and £250,000, where marginal relief tapers the two rates together.

One trap to plan for at formation: those £50,000 and £250,000 thresholds are divided by the number of associated companies. If you set up five SPVs, each one gets roughly £10,000 of the small-profits band, not the full £50,000, so the marginal rate bites much sooner. That single point often decides whether you run one company or several. When you take money out, dividends are taxed personally at 10.75 per cent (basic), 35.75 per cent (higher) and 39.35 per cent (additional). We do not re-run the extraction maths here; see our guides to salary versus dividends in a property SPV and extracting cash from a property SPV.

The personal-versus-company gap is set to widen. From 6 April 2027, individual property income is taxed at separate, higher rates of 22 per cent, 42 per cent and 47 per cent, enacted by Finance Act 2026, applying across England, Wales and Northern Ireland (Scotland sets its own income tax rates). The Section 24 tax reducer rises to 22 per cent in step, so no new wedge opens for basic-rate landlords, but for higher and additional-rate landlords the rates on personal rental profit climb. Company profits are unaffected by these personal rates, which is part of why landlords reinvesting profit are looking again at incorporation.

Step 1: Setting up a property limited company, and deciding on an SPV

Almost all property investors use a standard private company limited by shares. It gives limited liability, and the ongoing compliance is well understood. The more important decision is whether to set it up as a clean special purpose vehicle (SPV), and for buy-to-let the answer is almost always yes.

An SPV is simply a company set up to do one thing: hold and let property. It carries no unrelated trading activity. This matters because limited-company buy-to-let lenders strongly prefer, and many require, an SPV. A company whose only purpose is property is far easier for a lender to underwrite and to take security over than a general trading company with mixed activities. If you think you will ever borrow against the portfolio, set up an SPV from day one; converting a trading company into a lender-friendly SPV later is awkward and sometimes impossible. For the conceptual detail, see our SPV property investment guide.

Key decisions at this stage:

• Company name: must be unique and must not contain restricted or sensitive words. Check availability on the Companies House name-availability checker before you commit to branding or a domain.
• Directors and shareholders: you need at least one director aged 16 or over and at least one shareholder. These can be the same person. You also need to identify anyone with significant control (broadly, anyone holding more than 25 per cent of the shares or voting rights).
• Registered office: this becomes public record, and since 4 March 2024 it must be an appropriate address, meaning somewhere a document delivered there would come to the attention of a person acting for the company and where delivery can be acknowledged. A PO box no longer qualifies. Many landlords use their accountant's address to keep their home address off the public register.
• Registered email address: every company must give Companies House an email address for official correspondence and keep it current. It is not published on the public register, but failing to maintain it is an offence.

Choosing the right SIC codes for a property company

When you incorporate you must give at least one SIC code describing what the company does. For a property company this is not a box-ticking detail: lenders read the SIC codes to confirm the company is a genuine single-purpose property vehicle. The codes most commonly used and expected are:

SIC code	Description	Typical use for a property company
68100	Buying and selling of own real estate	Companies that may buy and sell property
68209	Other letting and operating of own or leased real estate	The core buy-to-let letting code most SPVs use
68201	Renting and operating of Housing Association real estate	Social or affordable housing letting
68320	Management of real estate on a fee or contract basis	If the company manages property for others

You can enter more than one code. For a straightforward buy-to-let SPV, 68100 and 68209 are the usual pairing. Avoid mixing in unrelated trading codes, because that is exactly what makes a lender treat the company as something other than a clean SPV.

Setting up an SPV to buy property: what a lender wants to see on day one

If you are forming the company with a mortgage in mind, the incorporation itself is part of the credit assessment. A limited-company buy-to-let underwriter will pull the company's Companies House record, often within days of your application, and what is on it either helps or costs you. Five things make a company read as lender-ready from the moment it is formed:

What the lender checks	What "lender-ready" looks like at incorporation
SIC codes	Property codes only, typically 68100 and 68209. No consultancy, no construction, no "other business activities" catch-all code sitting alongside them
Nature of business	No filed activity outside holding and letting property. A company that has traded at anything else is not a clean SPV, whatever its SIC codes say
Directors and PSCs	Identity verification complete, and the PSC statement matching the shareholding exactly. A mismatch reads as a structure the underwriter cannot follow
Registered office	An appropriate address. A residential address is not fatal, but an accountant's or agent's registered-office service looks more established and keeps your home address off the public record
Share structure	Simple and legible. Every shareholder over 25 per cent will be credit-checked and will usually be asked for a personal guarantee, so extra shareholders added for tax reasons add underwriting friction

Two practical points that catch people out. First, most lenders will not process an application for a company that does not yet exist, so incorporate before you make the offer rather than after. Second, changing the shareholding, the directors or the SIC codes mid-application usually triggers a re-underwrite and can reset your timeline, which is why the share structure decision below belongs before the filing, not after it.

Step 2: Decide your share structure before you incorporate

Share structure is far easier to set correctly at formation than to change afterwards. For a single owner, a small number of ordinary shares is fine. Where there is a spouse or family involved, many landlords issue separate share classes, often called alphabet shares (A ordinary, B ordinary and so on), so that dividends can later be voted in different amounts to different shareholders without having to re-paper the company.

Two points to get right at the outset:

• Match the share classes to your plan. If you want flexibility to split income between you and a spouse, build the share classes in now. Retrofitting them later means a share reorganisation.
• Mind the settlements legislation. Gifting shares to a spouse is generally protected by the spouse exception, but gifting income-only rights or shares to minor children can be caught by the settlements rules and the income taxed back on you. Take this seriously at the planning stage.

The detailed dividend-splitting mechanics and the family-planning angle are covered in our guide to alphabet shares for dividend splitting. If you are weighing a single company against a group or holding-company structure, our property company structure planning guide walks through that choice.

Set up an SPV limited company: how many shares, and at what nominal value

Share classes are the planning decision. How many shares to issue, and at what nominal value, is the mechanical one, and it is the field on the incorporation form that people fill in fastest and regret longest. Three things are being set at once:

• Nominal value per share. Almost always £1, occasionally £0.01. This is not a valuation of the company. It is the amount the shareholder owes the company for each share, and it fixes the maximum a shareholder can be called on to pay if the shares are issued unpaid. A £1 share in a company that later owns £2m of property is still a £1 nominal share; its market value has nothing to do with its nominal value.
• Number of shares issued. One £1 share is legal and common on cheap formations, and it is the choice that causes the most work later. A single share cannot be split without a subdivision or a further issue, so the moment you want to bring in a spouse at 50 per cent, or a partner at 25 per cent, you have to change the capital structure and file the changes. One hundred £1 ordinary shares is the more useful default for a property SPV: every percentage a lender, a spouse or a future co-investor is likely to ask for maps to a whole number of shares.
• Paid or unpaid. The statement of capital asks how much of the nominal value is unpaid. If you tick unpaid, that amount is a real debt owed by the shareholder to the company and it will show on the first set of accounts as called-up share capital not paid. For a £100 subscription the tidier answer is simply to pay it into the company bank account once the account opens.

Where alphabet shares are in the plan, both decisions are made together at incorporation: for example 100 A ordinary shares of £1 to one spouse and 100 B ordinary shares of £1 to the other, with the rights set out in the articles. Doing it at formation costs nothing beyond care with the form. Doing it in year three means a share reorganisation, new articles and, potentially, a chargeable event on the transfer of existing shares. The tax consequences of that split are covered in the alphabet shares guide above rather than repeated here.

Step 3: Set up your SPV at Companies House

To form the company you file an application (the online equivalent of the paper form IN01) with Companies House, either directly through their own service, through formation software, or through an agent such as your accountant. Filing online costs less and completes far faster. Companies House has also signalled that third parties filing on your behalf will in due course need to be registered Authorised Corporate Service Providers, so check the current transition timetable on the Companies House changes campaign page linked below before relying on someone else to file for you.

What do I need to register an SPV? The IN01 fields, one by one

The online journey is the paper IN01 broken into screens. Knowing what each field is actually asking prevents the two failure modes that matter: a rejected filing, and an accepted filing that says something you did not mean. Here is what the form asks for, in order, with the property-specific answer.

Field	What it asks	What a property SPV puts
Company name	A unique name ending in Limited or Ltd, checked against the index of company names and the sensitive-words list	Check availability before you buy a domain or order signage. Names that are too like an existing name can be challenged after incorporation, so near-misses are a false economy
Company type	Private limited by shares, limited by guarantee, PLC, LLP	Private company limited by shares. Limited by guarantee has no shareholders and is wrong for an investment vehicle
Registered office	An appropriate address in the same UK jurisdiction as the company (England and Wales, Scotland or Northern Ireland). Public record	An address that can acknowledge service. Not a PO box. Using an accountant's or agent's registered-office service keeps your home address off the register
Registered email	An email address Companies House uses for official correspondence	An address you monitor. Not published publicly, but it must be kept current, and reminders about filing deadlines go here
SIC code	At least one code for what the company will do	68100 and 68209 for a standard buy-to-let SPV. Add 68320 only if the company will genuinely manage property for others
Director details	Full name, any former names, date of birth, nationality, occupation, country of residence	Straightforward, but the date of birth must match the identity verification exactly. Day of birth is suppressed on the public register; month and year are shown
Service address vs residential address	Two separate addresses per director. The service address is public. The usual residential address is filed but not published	This is the field most often filled in wrong. Putting your home address in the service-address box publishes it permanently, and historic filings are not retrospectively scrubbed. Use the registered office or an agent's address as the service address
Subscribers (initial shareholders)	Name, address, and the shares each subscriber takes	The people who own the company on day one. The subscriber list and the PSC statement must agree with each other
Statement of capital	Number of shares, class, currency, aggregate nominal value, amount paid and unpaid per share, and the rights attaching to each class	For example 100 ordinary shares of £1 each, denominated in sterling, fully paid. If you are using alphabet shares, each class is listed separately with its own prescribed particulars of rights
Articles of association	Model articles, model articles with amendments, or bespoke articles	Model articles are fine for a single-owner SPV. Alphabet share classes, or anything agreed between co-investors, needs amended or bespoke articles uploaded at incorporation
PSC statement	Who owns or controls the company, and on which statutory ground	See below. This is a legal statement, not a formality
Lawful purposes statement	Confirmation that the intended future activities are lawful	A tick box at incorporation, repeated annually on the confirmation statement

How to register an SPV company: the PSC statement and what counts as significant control

A person with significant control is not simply "the owner". Companies House asks you to state which of the statutory conditions each PSC meets, and you can meet more than one. The conditions are:

• holding, directly or indirectly, more than 25 per cent of the shares;
• holding, directly or indirectly, more than 25 per cent of the voting rights;
• holding the right to appoint or remove a majority of the board of directors;
• otherwise having the right to exercise, or actually exercising, significant influence or control over the company;
• the same rights exercised over a trust or firm that itself meets one of the conditions above.

For each PSC you enter their name, date of birth, nationality, country of residence, service address, usual residential address (not published), the date they became a PSC and the nature of their control, including the band their shareholding falls into: over 25 per cent up to 50 per cent, more than 50 per cent up to 75 per cent, or more than 75 per cent. Two traps for property companies. First, alphabet shares can separate votes from value, so a spouse holding non-voting B shares may be over the 25 per cent share threshold without meeting the voting-rights condition, and the statement has to reflect that accurately rather than defaulting to both. Second, where the SPV is owned by a holding company, the holding company is normally the registrable relevant legal entity and the individual behind it is registered at the parent, not repeated at the subsidiary. Getting this wrong produces a PSC record that does not reconcile with the shareholding, which is exactly what a lender's underwriter and a bank's onboarding team look at.

Identity verification is now mandatory, and how the check actually works

Under the Economic Crime and Corporate Transparency Act 2023, every director and PSC must verify their identity with Companies House. Verification opened voluntarily on 8 April 2025 and became a legal requirement for newly appointed directors and PSCs on 18 November 2025. It is not a future change to plan for: if you are incorporating now, you verify now. Existing directors and PSCs of companies already on the register are being caught by a twelve-month transition running to around November 2026, with each company's deadline pegged to its own confirmation statement date.

There are two routes, and you can use either:

• Directly with Companies House, using GOV.UK One Login. You create or sign in to a One Login account and confirm your identity, in most cases through the app-based photo-ID check using a biometric passport, a UK photocard driving licence or a biometric residence permit. Where the app route does not work there is a browser-based alternative and, as a fallback, an in-person check at a Post Office. On success you receive a personal code that identifies you across Companies House filings.
• Through an Authorised Corporate Service Provider (ACSP). An ACSP is a firm supervised for anti-money-laundering purposes that has registered with Companies House to verify identities. In practice this is usually your accountant or company-secretarial agent. They verify you using the anti-money-laundering checks they already have to perform, then confirm the verification to Companies House. This route is the practical one where the accountant already holds certified ID for you, or where the app-based check fails.

Two points that save real time. Verification is per person, not per company: verify once and it carries across every directorship and PSC interest you hold, which matters if you are building a portfolio across several SPVs. And verification should be done before you file the incorporation, not after, because an unverified director stops the company being usable rather than merely being an outstanding item. Companies House publishes the current commencement position on its changes to UK company law pages, which is the source to check if you are reading this some months after publication.

The Companies House registration fee

The statutory incorporation fee charged by Companies House is:

Route	Statutory fee	Typical processing time
Online (recommended)	£100	Usually within 24 hours
By post (paper IN01)	£124	8 to 10 working days

This is the government filing fee for forming the company itself, payable to Companies House, and it rose from the old lower fee in 2024, so older guides quoting £12 are out of date. Whatever else you choose to spend depends entirely on your own circumstances, which is why this guide does not quote service costs; see our full breakdown of what an SPV costs to set up for the wider figure, including accountancy, bank account and ongoing compliance costs.

Do not confuse the incorporation fee with the annual one. The confirmation statement, which every company files once a year to confirm its details, costs £50 online or £110 by post. That £50 is a recurring annual figure and is never the cost of forming the company. Current fees are published on the Companies House fees page.

How an SPV is formed: a realistic timeline from name check to first rent

The "24 hours" figure describes one step, not the process. Here is what the whole sequence actually takes for a first-time property company, assuming nothing goes wrong.

Stage	Realistic elapsed time	What controls it
Decision and share-structure planning	A few days to a few weeks	The only stage where thinking longer pays. Everything after this is administration
Name availability check	Minutes	Free on the Companies House name-availability checker. Check the trade mark register too if the name will be a brand
Identity verification for each director and PSC	Same day to a few days	Minutes if the One Login app check works first time. Longer if the app fails and you need the Post Office route, or if you are waiting on an ACSP to complete their checks
Filing the incorporation	Under an hour to complete	Have the statement of capital and PSC detail decided before you start. Bespoke articles need to be ready to upload
Certificate of incorporation issued	Usually within 24 hours online, 8 to 10 working days by post	Companies House processing. Rejections, usually a name clash or an inconsistent PSC statement, restart the clock
Business bank account approved	Commonly one to four weeks	The real bottleneck. Cannot start until the certificate exists. App-based business accounts are usually days; high-street banks with a branch appointment are usually weeks
Corporation Tax reference received	Days after incorporation	Issued automatically to the registered office. Separately, tell HMRC the company is active within three months of the first rent
Mortgage offer, if borrowing	Weeks, running in parallel	Can usually start once the company exists. Changing directors, shares or SIC codes mid-application resets underwriting

Two working conclusions. From decision to a company that can actually receive rent, allow two to six weeks, dominated by the bank account rather than by Companies House. And if a purchase is already agreed, incorporate immediately: the company has to exist before the lender will progress and before the bank will open the account that the deposit has to move through.

Step 4: Open a business bank account

Once Companies House approves the application you receive your certificate of incorporation. You can then open a dedicated company bank account. Banks typically ask for:

• the certificate of incorporation;
• the company's articles of association;
• proof of the registered office address;
• directors' identification documents;
• details of expected turnover and transaction volumes.

Open the account before any rent or property money flows, and never run property income through a personal account. Mixing company and personal money is one of the most common and most damaging mistakes new property-company owners make, and it undermines the limited-liability protection you incorporated for.

Step 5: Activate Corporation Tax (CT41G is no longer used)

This is the step where most older guides are wrong. You do not file form CT41G any more. When you incorporate at Companies House, HMRC sets up your Corporation Tax record automatically and issues a Corporation Tax reference. From there you:

• add Corporation Tax to your business tax account online (you often get the option to set this up at the same time as the Companies House registration); and
• tell HMRC the company is active within three months of starting to trade or receive income, which for a property company means within three months of the first rent or property activity.

From then on, your Corporation Tax return is due 12 months after the end of your accounting period, and any Corporation Tax due is payable 9 months and one day after the period end. Note the gap: the payment deadline falls before the filing deadline, so plan cash flow accordingly.

Step 6: VAT, PAYE and employer obligations

Most residential rental income is exempt from VAT, so a new property company usually does not register for VAT at the outset. You only need to consider VAT registration if:

• you opt to tax commercial property;
• you provide standard-rated services (such as serviced accommodation extras) above the threshold; or
• you develop property for sale.

The VAT registration threshold is £90,000 of taxable turnover. Separately, if you or other directors are paid a salary, the company must register as an employer for PAYE and operate payroll, including auto-enrolment pension duties where they apply. Whether a salary is worthwhile alongside dividends is an extraction decision covered in our salary versus dividends guide.

Step 7: Set up bookkeeping and a compliance calendar

A company faces stricter record-keeping than an individual landlord, and the filing deadlines are unforgiving. Put a system in place from day one:

• Bookkeeping: cloud software such as Xero or QuickBooks, tracking all income, expenses, assets and liabilities, with company transactions kept entirely separate from personal ones.
• Annual accounts: filed with Companies House within 9 months of the year end.
• Confirmation statement: filed annually to confirm the company's details, now including a lawful-purposes statement.
• Corporation Tax return: filed within 12 months of the accounting period end, with tax paid 9 months and one day after.

What about properties you already own personally?

Forming a new company to buy future properties is one decision. Moving properties you already own personally into a company is an entirely different and much more costly one, because it is treated as a sale at market value from you to the company. That can trigger two charges:

Charge on transfer	What applies
Capital Gains Tax	18 per cent or 24 per cent on the gain on each residential property, with the annual exempt amount of £3,000 available against gains
Stamp Duty Land Tax	The company pays SDLT on the market value, including the 5 per cent additional-dwellings surcharge on the whole price (the surcharge rose from 3 per cent to 5 per cent for transactions on or after 31 October 2024)

In some cases incorporation relief under section 162 TCGA 1992 can defer the CGT, where you transfer a genuine property business as a going concern wholly or partly in exchange for shares. There are real conditions and a claim is required. This is a specialist decision in its own right, so we do not re-run the section 162 tests or the phased-versus-single-day mechanics here. If you already own a portfolio personally, read our dedicated guide to incorporating a property portfolio and take advice before transferring anything. For many landlords the practical answer is to keep existing properties personally owned and buy new ones through the company.

Higher-value properties: the ATED point most new owners miss

If your company holds a single UK residential dwelling worth more than £500,000, it falls within the Annual Tax on Enveloped Dwellings (ATED). Ordinary buy-to-let companies usually qualify for relief because they let to unconnected tenants, but the relief is not automatic. You must still file an ATED return by 30 April each year to claim it. Miss the filing and you face penalties even though no tax was due. If any one property is worth over £500,000, add the 30 April ATED return to your compliance calendar now.

Does Making Tax Digital apply to a property company?

No. Limited companies are outside Making Tax Digital for Income Tax entirely; they file Corporation Tax returns. Making Tax Digital for Income Tax applies to your personal property and self-employment income, and it is now being phased in from 6 April 2026 for qualifying income over £50,000, from 6 April 2027 over £30,000, and from 6 April 2028 over £20,000. So if you keep some properties personally and hold others through the company, the personal ones may be in MTD while the company is not. Our Making Tax Digital for property income guide covers the personal side.

Common mistakes when setting up a property company

• Incorporating before modelling the numbers. A company is not automatically better. Model your specific position, including how you intend to take income, first.
• Using the wrong SIC codes or a trading-company structure. This can block buy-to-let lending. Set up a clean SPV with property SIC codes.
• Ignoring the associated-companies rule. Multiple SPVs split the small-profits band, pushing more profit into the 26.5 per cent marginal zone.
• Getting the incorporation details wrong. A home address entered as a director's service address is published permanently, and a PSC statement that does not reconcile with the shareholding is the item a lender's underwriter and a bank's onboarding team both question. Both are avoidable at the filing and awkward afterwards.
• Leaving identity verification until after filing. It has been a legal requirement for new directors and PSCs since 18 November 2025, and an unverified director holds up everything downstream.
• Forgetting to tell HMRC the company is active within three months of receiving rent.
• Mixing personal and company money. Keep them completely separate from the first transaction.
• Overlooking the ATED return on a property worth more than £500,000, even when relief applies.

Set up a limited company for property investment: the full sequence

To summarise the route from decision to a working company:

1. Model whether a company suits your situation, and how you will take income.
2. Choose a unique name and the right property SIC codes.
3. Decide your share structure before you file: how many shares, at what nominal value, in which classes.
4. Verify the identity of every director and PSC, either through GOV.UK One Login or through an ACSP.
5. Register online with Companies House (the statutory fee is £100 online or £124 by post), checking the service address and PSC statement carefully before you submit.
6. Open a dedicated business bank account.
7. Activate Corporation Tax via your business tax account and tell HMRC the company is active within three months of starting to receive rent.
8. Put bookkeeping and a compliance calendar in place.

Incorporating adds genuine tax flexibility for the right landlord, but it also adds compliance, cost and complexity, and getting the structure, SIC codes and share classes right at formation is far easier than fixing them later. If you are weighing it up, our guides to what a property accountant does and how to choose a property accountant are a good next step, and the enquiry form on this page will connect you with a specialist who can review your plan before you file.