Property Company Running Costs: What You Need to Budget For Each Year

The headline tax case for a limited company property business gets all the attention. The recurring cost of keeping that company compliant gets almost none, and that is where landlords are caught out. A sole trader files one personal return a year. A company is a separate legal person with its own filing calendar, its own tax return, its own bank account and its own bookkeeping discipline, and every one of those is a line in your annual budget.

This guide sets out what to budget for, category by category, rather than quoting a single number that would be wrong for most readers. The fixed statutory fees are small. The real cost is professional time, and that scales with how many properties you hold, how many lenders you deal with, whether you run a director's loan account, and how clean your records are. Get the categories right and the figure follows from your own portfolio.

The compliance calendar: the obligations that drive every cost

Almost every recurring cost of a property company exists to meet a statutory deadline. Understand the calendar and you understand the budget. Four dates do most of the work.

Obligation	Filed with	Deadline	What it covers
Confirmation statement	Companies House	Annually, by the anniversary of incorporation or the last statement	Confirms registered details, directors, shareholders and people with significant control
Statutory accounts	Companies House	Within 9 months of the accounting reference date (private company)	The company's financial statements for the year
Corporation tax payment	HMRC	9 months and 1 day after the period end	Tax on the company's taxable profit
Corporation tax return (CT600)	HMRC	Within 12 months of the period end	The tax computation and return itself

Two of those, the accounts and the CT600, are usually prepared from the same year-end work, which is why most directors engage an accountant to handle both together. Note the quirk that the corporation tax is due (nine months and one day) before the return that calculates it is due (twelve months), so the tax has to be estimated and paid first. Missing the accounts deadline triggers automatic Companies House penalties that escalate the longer the delay runs, and a late CT600 triggers separate HMRC penalties. The cost of disciplined record-keeping is always lower than the cost of a missed date, which is the single most useful budgeting principle for a company landlord.

Statutory filings: the fixed floor

The confirmation statement is the smallest recurring obligation, a once-a-year filing that confirms your registered details, directors, shareholders and persons with significant control are correct. The Companies House fee for it is modest and fixed. Many directors file it themselves; others fold it into the accountant's engagement so nothing is forgotten.

Statutory accounts are the larger piece. Even a small property company that qualifies to file abbreviated or filleted accounts still needs those accounts prepared correctly, with property carried at the right value, mortgage balances reconciled, and any director's loan disclosed. This is where most of the year-end professional time goes, and it is the line most sensitive to how tidy your records are during the year.

For the detail of what HMRC and Companies House expect from a property company's books and statements, see our guide to property company accounting requirements and HMRC expectations.

Accountancy and bookkeeping: the largest variable

Professional support is the cost that varies most between companies, because it is the cost that scales with complexity. A single-director company holding two unencumbered properties is straightforward. A company with ten properties across several lenders, a director's loan account that moves throughout the year, refinancing activity and a part-disposal is a materially bigger piece of work, and the fee reflects that.

A typical year-end engagement for a property company covers the statutory accounts, the corporation tax computation and CT600, the confirmation statement, and basic compliance correspondence. Bookkeeping (recording rent, expenses, mortgage interest and capital movements through the year) is sometimes bundled and sometimes run separately, either by you in cloud software or by the accountant on your behalf. The cleaner the bookkeeping, the lower the year-end accounts work, which is why the two are best thought of as one budget rather than two.

Beyond compliance sits advisory time: tax planning on profit extraction, the timing of a disposal, lender-driven restructuring, or pension contributions from the company. These are not annual fixtures, but most active companies use some advisory time each year, so it is worth a contingency in the budget. The value of working with a property-specialist accountant over a general practice is that the specialist already understands Section 24, the company-versus-personal extraction maths and property disposals, so the work is faster and the planning sharper. Our guide on how to choose a property accountant covers what to look for.

Business banking and the director's loan account

A limited company is a separate legal person, so its rent is its money, not yours. A dedicated business bank account is, in practice, a fixed and unavoidable running cost. It keeps the company's money clearly its own, gives lenders the statements they expect, and keeps the bookkeeping clean enough that the accounts are cheaper to prepare.

The cost of not having a clean separation shows up in the director's loan account. Every time you put personal money into the company or take company money out other than as salary, dividend or expense reimbursement, you move the director's loan balance. If that account is overdrawn (the company owes you less than you have drawn) at the year-end, it can carry its own corporation tax charge under the close-company rules and has to be tracked carefully. That tracking is professional time, which is cost. Running a proper director's loan account from the start, through the business bank account, keeps that cost down.

Software and digital record-keeping

Cloud bookkeeping is now the default for a reason: it keeps records current, makes the year-end faster, and reduces the professional time you pay for. Budget for a bookkeeping subscription, and for property management software if your portfolio is large enough to need rent tracking, arrears chasing and tenant records in one place.

On Making Tax Digital: MTD for Income Tax (MTD for ITSA) applies to the personal income of individual landlords and sole traders, not to a company's corporation tax return. It is phased in by qualifying income, from 6 April 2026 above GBP50,000, 6 April 2027 above GBP30,000 and 6 April 2028 above GBP20,000. Your company already files digitally for corporation tax. But MTD still touches a company landlord in two ways. First, any property you continue to hold personally, alongside the company, can pull you into MTD for ITSA in your own name once your personal qualifying income crosses a threshold. Second, the discipline of digital, software-kept records is exactly what keeps the company's year-end cheap. Treat MTD-ready bookkeeping as the standing operating model rather than something to retro-fit.

Insurance and optional professional cover

Directors of property companies sometimes take out professional or directors' and officers' cover, though neither is legally required for a company that simply holds and lets property, and the risk profile of a straightforward rental business is low. This is a judgement call rather than a fixed obligation. What is not optional is the underlying property insurance (buildings, and where relevant landlord liability) on each property, which sits in the property's own costs rather than the company's compliance overhead but still belongs in the overall budget.

One-off setup versus recurring running cost

The first year of a property company is heavier, but mostly as a one-off rather than a permanent uplift. Separating the two stops you over-budgeting the steady state.

Cost type	One-off (setup)	Recurring (each year)
Company formation	Incorporation and registration	Confirmation statement
Banking	Opening the business account	Account and transaction charges
Bookkeeping	System setup and chart of accounts	Subscription and ongoing entry
Accountancy	First-year setup and onboarding	Accounts, CT600, confirmation statement
Moving properties in	Conveyancing, lender consent, SDLT, possible CGT	None once transferred

The line that most often surprises new company landlords is the bottom row. Moving an existing personally held property into a company is a disposal at market value, so Stamp Duty Land Tax (LBTT in Scotland, LTT in Wales) is normally due on the company's acquisition, and Capital Gains Tax can arise on the personal disposal unless a relief such as incorporation relief applies. Residential CGT is charged at 18% and 24% (the unified rates under section 1H TCGA 1992), with an annual exempt amount of GBP3,000. None of that is a running cost, but it is real money at the front end and it belongs in the incorporation decision rather than the annual budget.

Does the company structure earn its keep?

The recurring overhead of a company is largely fixed, so the question is whether the tax and commercial benefits clear that fixed bar. For a basic-rate taxpayer with one or two properties and modest profit, they often do not: the Section 24 finance-cost restriction (a 20% basic-rate tax credit on mortgage interest) bites far less on a basic-rate taxpayer, so the saving from incorporating is small while the compliance is the same.

The structure tends to earn its keep where you are a higher-rate taxpayer, where you intend to retain profit inside the company to reinvest rather than draw it all out, or where you are building a portfolio across several mortgaged properties. The company can also pay employer pension contributions for director-shareholders, which is an extraction route a sole trader does not have; we cover that in our guide on employer pension contributions for property company directors.

From April 2027, separate property-income tax rates take effect (22%, 42% and 47%) as enacted by Finance Act 2026, applying to England, Wales and Northern Ireland, with Scotland outside the change for 2027/28. The Section 24 basic-rate reducer rises to 22% in step, so no new basic-rate wedge opens. That shift sharpens the comparison for some higher-income landlords without changing the basic principle: a company only makes sense where the benefit beats the fixed overhead. Our guide on corporation tax versus income tax for landlords in 2027 works the tax side through, and the wider context sits in our 2026 landlord tax changes guide.

A practical way to build your annual budget

Rather than reach for a single number, build the budget from the categories above and let your own portfolio set the size. List the recurring items: confirmation statement, statutory accounts and CT600, bookkeeping software, business banking, and a contingency for advisory work. Add the optional items you actually want, such as professional insurance or property management software. Then size the professional-time lines against your reality: how many properties, how many lenders, whether there is a director's loan to track, and how clean you will keep the records.

That last factor is the one most within your control. A company that books transactions monthly through cloud software and runs everything through the business account hands the accountant a tidy year-end. A company that hands over a shoebox in month twelve pays for the catch-up. The cheapest year-end is the one you have already half-prepared, which is why MTD-style digital discipline pays for itself even though the company's corporation tax return is not itself an MTD obligation. For tailored figures, ask a property-specialist accountant to quote against your actual portfolio rather than a generic range.