Property incorporation calculator

It adds up the capital gains tax and SDLT that moving your portfolio into a company could trigger. It then works out the yearly saving: the income tax you pay on your rental profit now, with Section 24, less the corporation tax a company would pay on the same cash profit. Dividing the upfront tax by the yearly saving gives the years to recover it. If a company wouldn't save tax on your figures, it says so.

You and your company are connected, so the transfer is treated as a sale at market value even if no cash changes hands. The calculator takes the portfolio's current value, deducts what the properties originally cost, including buying costs and improvements, and taxes the gain at 18% within your remaining basic rate band and 24% above, after the £3,000 annual exempt amount. Without incorporation relief, that tax is due on the transfer.

It treats the transfer as if relief doesn't apply, so you see the full capital gains tax. That's the cautious view, because relief depends on facts HMRC won't confirm in advance. Choosing 'yes' sets the capital gains tax to nil, showing the position if the conditions are met and relief is claimed. Comparing the two answers shows how much of the decision rides on whether your letting counts as a business.

Sometimes. Incorporation relief needs a business, which is wider than a trade but more than passively holding investments. HMRC follows the Ramsay case, asking whether the letting is a serious undertaking, earnestly pursued and run on sound business principles. HMRC accepts relief where an owner personally spends 20 hours or more a week on the business; below that, it decides case by case. Landlords who actively manage several properties are more likely to qualify.

Yes. For transfers on or after 6 April 2026, incorporation relief is no longer automatic. It must be claimed, with the information HMRC asks for, such as details of the business, the company and the shares issued, plus a computation. For a transfer in the 2026/27 tax year, the deadline is 31 January 2029. The calculator's 'yes' option assumes a valid claim is made in time and the conditions are met.

It postpones it. The gain is deducted from the base cost of the shares the company issues to you, so it comes back into charge if you later sell or otherwise dispose of those shares. The company itself takes the properties at market value. Relief requires the whole business, with all its assets other than cash, to be transferred as a going concern for shares. Where part of the payment isn't in shares, relief is reduced proportionately.

A company buying a dwelling worth over £500,000 can pay a flat 17%, but a company running a property rental business can usually claim relief from that rate. The calculator assumes that relief applies, so it uses residential rates with the 5% higher-rates surcharge, charged on the market value of everything transferred, because a transfer to a connected company is taxed on market value. Relief from the 17% rate can be withdrawn if conditions stop being met within three years.

When six or more dwellings are bought in a single transaction, the buyer can use non-residential rates instead: nothing on the first £150,000, 2% to £250,000 and 5% above. With the 5% surcharge, residential rates on a large portfolio are usually higher, so the calculator takes the lower of the two. Multiple dwellings relief, which used to reduce SDLT on bulk purchases, was abolished from 1 June 2024.

No. Where a property business is genuinely run as a partnership, the special SDLT rules for partnerships can reduce or remove SDLT when properties move to a company connected with the partners. Those rules have strict conditions, three-year clawback rules and anti-avoidance provisions, and HMRC challenges arrangements put in place mainly to save tax. Because whether they apply depends so much on your facts and history, the calculator shows SDLT without them.

No. It compares the tax you pay personally now with the corporation tax a company would pay on the same cash profit, assuming the company keeps its profits. If you need the rental income to live on, dividends are taxed again at 10.75%, 35.75% or 39.35% in 2026/27, after a £500 allowance. For landlords who reinvest, the calculator's comparison is closer to reality; for those who draw everything out, the saving can be much smaller.

Several. It doesn't include refinancing (lenders usually need new company mortgages, which can mean arrangement fees and early repayment charges), legal and conveyancing costs, valuations, accountancy, or ATED for company-owned dwellings worth over £500,000, which needs annual returns even where relief means nothing is paid. It also ignores inheritance tax. Any of these can change the payback period noticeably, so they belong in a proper review.

No. It uses 2026/27 rates for the personal side, with rent taxed at 20%, 40% and 45% and a 20% Section 24 credit. From April 2027, rental profits held personally will be taxed at 22%, 42% and 47%, with a 22% credit. Companies aren't affected, as they pay corporation tax. So for a profitable portfolio, the yearly saving shown is likely to understate the gap from 2027/28, and the payback period may be shorter.

Not directly, as it assumes a single owner with one set of other income and one annual exempt amount. A rough approach is to run it once for each owner's share of the value, cost, rent and interest, using their own other income, then take the SDLT from a single run on the full value. Joint ownership also affects whether the letting is run as a partnership, which matters for both incorporation relief and SDLT.

Not in practice. There's no statutory clearance for incorporation relief, and HMRC's non-statutory clearance service won't give a view on matters of fact, including whether your activities amount to a business. That's why the evidence of how the portfolio is run, and the way the transfer is documented, matter so much. An adviser can assess your position against HMRC's published guidance and the case law before you commit.

If the calculator shows a payback period you could live with, a review is the next step, before you speak to lenders or solicitors. We look at whether relief is likely, the SDLT position, refinancing, how you'll draw income and your long-term plans for the portfolio. We've advised on £100m+ of property incorporated, for portfolios up to £30m. Work is on a fixed fee agreed upfront, and we respond the same working day.