A special purpose vehicle (SPV) can pass every affordability test a buy-to-let lender applies and still be declined before the property is valued. The reason is often a single field on the public register: the company's SIC code. If the code describes property trading rather than letting, some specialist lenders refuse the case at decision-in-principle, and the rental cover is never even assessed. This page sets out the codes lenders accept for a property SPV, why one code in particular causes declines, and how to correct a wrong or missing code at no extra fee before you apply.
This is the finance mechanics of the SIC code, not the tax or company-structure decision. Whether you should hold property through a company at all, and how a company is taxed differently from personal ownership, sits on our limited company versus personal ownership tax comparison and the broader SPV property investment guide. Here we deal only with the code that keeps a mortgage application alive.
What a SIC code is and why a mortgage lender cares
A Standard Industrial Classification (SIC) code is a five-digit number that describes the main activity of a UK company. Every limited company records at least one and up to four codes at Companies House, first at incorporation and then on each annual confirmation statement. The codes are statistical: they tell government what the company does, and they appear on the free public register that anyone, including a lender, can read.
For an ordinary trading company the code is background detail. For a property SPV applying for a buy-to-let mortgage it is a gate. A specialist SPV lender wants to see a clean, single-purpose company that holds property and collects rent, not a business that trades, develops or does something unrelated. The SIC code is the quickest signal of that. Before an underwriter looks at the property, the rent or the personal guarantee, an automated or manual check reads the registered activity. A code that says "letting" moves the case forward. A code that says "buying and selling" can stop it.
This is why the SIC code sits at the seam between accounting and mortgages. It is set when the company is formed, usually by whoever handled the incorporation, and it is rarely revisited. A landlord who set up a company months or years before applying for finance may never have checked whether the code a formation agent chose is the one lenders accept. For more on how lenders assess the company itself, see SPV mortgages explained.
The SIC codes lenders accept for a property SPV
Four codes in the 681xx and 682xx range come up for property companies. They are not interchangeable. The table below sets out what each one means and how buy-to-let lenders tend to treat it. Codes and definitions are taken from the Companies House condensed SIC list; lender treatment is a market norm, so confirm the accepted list with the specific lender or a broker at application time.
| SIC code | Companies House description | How SPV lenders read it |
|---|---|---|
| 68209 | Other letting and operating of own or leased real estate | The primary, most widely accepted code. Describes a company that owns and lets property. The default code for a buy-to-let SPV. |
| 68201 | Renting and operating of Housing Association real estate | Accepted as a supporting letting code. Commonly listed alongside 68209 rather than as the sole code. |
| 68320 | Management of real estate on a fee or contract basis | Accepted as a supporting code. Describes managing property, so it usually sits behind 68209, not in front of it. |
| 68100 | Buying and selling of own real estate | Read as trading or development. Several lenders will not lend to a company whose only code is 68100. Fine as a supporting code if you also develop, but not as the sole code for a hold-and-let SPV. |
The practical rule most brokers work to is straightforward: make 68209 the primary code, and add 68201 and 68320 as supporting codes if you wish. That combination reads unambiguously as a property-holding and letting company. Leading with 68100, or listing it on its own, is the pattern that causes trouble, because it describes dealing in property rather than holding it for rent.
Why a 68100-only company gets declined: a worked example
Consider a landlord who incorporated an SPV to buy a £165,000 terraced house to let. The formation agent registered the company under SIC 68100 only, reading "buying property" literally when the company was set up. Months later the director finds a house, and the broker submits the case to a specialist SPV lender.
The lender's screening reads the register, sees 68100 (buying and selling of own real estate) as the sole activity, and classifies the company as a property trader rather than a rental SPV. The case is declined at decision-in-principle. Crucially, this happens before the property is valued and before the rent is stress-tested, so the affordability was never the problem. The house would have cleared the usual limited-company interest coverage test comfortably. The application died on a classification, not on the numbers.
The correction is quick and costs nothing beyond filing time. The director files a confirmation statement to update the codes, making 68209 the primary activity and adding 68201 and 68320 as supporting codes. Once the change is accepted and shows on the register, the same company is now an acceptable borrower to the same lender, and the case can be resubmitted. No money changes hands for the code amendment itself, and the property is unchanged. Only the registered activity moved from "trading" to "letting".
How to add or change your SIC code
SIC codes are amended on the confirmation statement (form CS01) filed with Companies House, following the confirmation statement guidance on gov.uk. You do not need a special form or a separate application. There are two routes:
- Update at renewal. When your annual confirmation statement falls due, you review and change the codes as part of that filing.
- File an updating statement early. You do not have to wait. You can file a confirmation statement at any time specifically to correct the codes, which is what you do when a mortgage application is imminent.
There is no separate fee to change the codes. Companies House charges the standard confirmation statement fee once per annual payment period; if you have already paid that within the current period, an updating statement filed to fix the codes carries no further charge. Filing online is usually accepted quickly, and the amended codes then appear on the free public register that lenders check.
Two practical points. First, check your existing entry on the Companies House register before you do anything, because your codes may already be correct and no change is needed. Second, only register codes that honestly reflect what the company does. The point is not to game the classification; it is to make sure a genuine hold-and-let SPV is not mislabelled as a trader by a code chosen carelessly at formation. If you are still setting the company up, our guide to setting up a property investment company covers getting the structure right from the start.
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Multiple SIC codes and mixed trading or investment companies
A company can hold up to four SIC codes, and listing more than one is normal. For most property SPVs the clean set is 68209 primary, with 68201 and 68320 as supporting codes. Lenders have no objection to multiple codes, provided the primary code describes letting and none of the others contradicts the single-purpose nature of the vehicle.
The difficulty arises with genuinely mixed companies. If a company both develops or flips property (a trading activity that legitimately uses 68100) and holds rentals, its codes will reflect both, and its accounts will show trading income. Specialist buy-to-let lenders prefer a company that does one thing: hold and let. A vehicle that mixes development and letting can be harder to place, not because of the code alone, but because the code points to a business model lenders find harder to underwrite. The common answer is to keep a separate, clean SPV for the rental portfolio, so the borrowing company is unambiguously a letting vehicle. Whether a separate company makes sense is partly a tax and structure question, covered on our SPV property investment guide.
A brand-new company with the right code but no trading history is a different question again, and not a barrier in itself. SPV lending is underwritten on the property and a personal guarantee, not the company's accounts, so a day-old SPV with 68209 and no income can still borrow. That scenario is covered in full on SPV mortgages with no income and a newly formed company.
The tax overlay, and where the SIC code does not reach
It is worth being clear about what the SIC code does not do: it does not change how the company is taxed. Corporation tax, the treatment of finance costs, and the whole reason many landlords use a company rather than personal ownership are separate questions the code has no bearing on. The core tax driver is that a company deducts mortgage interest in full against rental profit, while an individual landlord gets only a basic-rate (20%) tax reducer under the Section 24 finance-cost restriction. That gap is the single biggest reason SPV buy-to-let demand exists.
We do not re-argue that tax decision here. The full working sits on our Section 24 tax relief guide and the limited company versus personal ownership comparison. The point for this page is only that fixing your SIC code is a lending step, not a tax step. Changing 68100 to 68209 to satisfy an underwriter has no direct tax effect, and it does not by itself alter whether the company should have been formed at all. Get the tax decision right first, then make sure the code reflects it.
Getting the SPV lender-ready before you apply
The SIC code is one of a short list of things that decide an SPV application before the property is ever looked at. The others are the company being a clean single-purpose vehicle, a director willing to give a personal guarantee, and rent that clears the interest coverage test (limited-company borrowers are typically assessed at 125% cover, stressed at around 5.5%, under the Prudential Regulation Authority's buy-to-let underwriting standards (SS13/16), though the exact figures are lender-specific and worth verifying at application time). You can sanity-check the affordability side yourself with our buy-to-let rental stress test calculator and estimate borrowing with the buy-to-let mortgage calculator. The starting point for how SPV mortgages work overall is our buy-to-let mortgages guide.
A quick pre-application checklist for the company side:
- Check the SIC codes on the Companies House register. Is 68209 the primary code? If the only code is 68100, correct it.
- Confirm the company holds property for letting only, not trading or development, or keep a separate SPV if it does both.
- Have the confirmation statement up to date, so the register reflects reality.
- Line up the personal guarantee and the deposit, and check the rent clears the stress test before you submit.
None of this is regulated mortgage advice, and none of it is something to guess at under time pressure when a purchase is agreed. If you want the company and the tax side reviewed, and a warm introduction to a broker who lends to limited companies and portfolios, send us a few details below. To be clear on scope: this is a business-purpose introduction for company and portfolio lending only. If you are buying a home for yourself or a family member to live in, that is a regulated mortgage contract, which we do not arrange or introduce, and you should speak to an FCA-authorised mortgage adviser. What we offer is a bare introduction under the Regulated Activities Order, not a financial promotion of any product under section 21 of the Financial Services and Markets Act 2000. We also do not advise on or sell insurance.
The SIC codes and Companies House filing process described here are drawn from the Companies House SIC condensed list and confirmation statement guidance. Interest coverage and stress-test figures are market norms under the PRA's buy-to-let underwriting standards and are lender-specific; verify current criteria at application. This page is general information, not regulated mortgage advice or a recommendation of any product or lender.