Why more investors are choosing limited company buy to let mortgages

As a property investor or landlord it is important to monitor trends are in the UK property market. This is particularly true during periods when there have been a lot of changes and developments. Large changes in investor behaviour are typically made to optimise financial performance, so overlooking them could have a negative effect on your financial situation.

In 2025, an ongoing and significant trend in property finance has been the rise of limited company buy to let mortgage investment. Choosing to incorporate to buy and remortgage property has become increasingly popular with UK investors. So, why exactly are UK investors choosing this path and what are the advantages? 

What are limited company buy to let mortgages?

As the name implies, these are mortgages that are designed for companies buying properties to rent out. You can buy property through a company that is already set up and trading for unrelated purposes, you typically require a deposit of at least 25%. 

However, lenders prefer a dynamic where the limited company is set up specifically for property investment, you typically need a deposit of at least 15%. Where a company is set up specifically for property investment, it means other business risks are kept separate from the asset the lender is issuing the loan against.

There are borrowing options for both situations, but you will have a greater choice of products if you ring-fence your property investments in their own company structure.

The advantages of limited company buy to let mortgages

One of the main advantages of investing via a limited company is tax efficiency. Profits retained with a business are subject to corporation tax rather than personal income tax, which may reduce your tax burden (particularly if you are a higher-rate taxpayer).

In addition to tax efficiency, limited company buy to let mortgages can be helpful because you can claim full mortgage interest tax relief, where personal investors only get a flat 20% basic-rate tax credit. Inheritance tax planning becomes more flexible when it comes to succession planning. Company shares can be gifted or transferred gradually. A company can retain profits after tax and be reinvested back into the company. Legal liabilities are ringed fenced to the company too.

However, be aware that while a lot of sources will tell you that financial liabilities for a mortgage will be held within the company structure with no personal impact, this is not the case. Limited company buy to let mortgage lenders all require personal guarantees from the directors of the company in the event the company is unable to keep up with mortgage payments. 

The impact on investment strategy

Profitability is naturally a primary concern with any investment, so being able to adapt your investment strategy according to market conditions is vital. 

Some people wrongly assume a mortgage broker can advise on whether or not to go down the limited company path to investing in property, they can’t. Given the decision hinges on tax implications, you need to seek the advice of a tax professional.

A mortgage broker can advise you on the difference between mortgages taken out in personal name versus mortgages taken out via a limited company, which will give you a picture of the costs involved. The mortgage application process is the same, it’s just the type of product that you need that will differ. 

Given how significant the trend to incorporate has been and continues to be, lenders have been well ahead of the game and so the choice of products is significant. You may find though that a generalist mortgage broker will struggle to help you invest via this route, due to the added complexity of the products.

How to get a limited company buy-to-let mortgage

For UK investors looking to secure a limited company buy to let mortgage, it is wise to speak with a specialist mortgage advisor like Commercial Trust. Specialists like this can find a great deal by comparing over 80 UK lenders and answer any questions you have. It is possible to get a lender decision in principle in as little as two hours after making a call, which saves you a lot of time and hassle while ensuring that you get the best possible deal. 

The popularity of limited company buy to let mortgages has surged in the UK in recent years. Many UK investors are now realising the advantages of obtaining a BTL mortgage through a limited company, particularly when it comes to tax efficiency. With a number of changes made to tax rules relating to property investment, obtaining a mortgage through a limited company could prove to be financially advantageous while helping investors with diverse investment strategies.