If you’re thinking about investing in property for the first time, you’re not alone. With property seen as one of the most reliable ways to build long-term wealth, more and more people are exploring how to do it in a smarter, more tax-efficient way. One option that’s gaining real traction among UK investors is setting up a limited company – specifically, something called an SPV (Special Purpose Vehicle).
It might sound a bit technical at first, but don’t worry – we’ll break everything down in plain English. By the end of this guide, you’ll have a clear idea of what an SPV is, why it’s used, and how you can go about setting one up for your property investment journey.
How to Set a Property SPV Up: Step-by-Step
Ready to get going? Here’s how to set up SPV property limited company formation, step by step.
Step 1: Choose a Company Name
Keep it simple and professional. Check with Companies House to make sure it’s available and doesn’t clash with existing company names.
Step 2: Register the Company
You can register your SPV online through Companies House. During registration, you’ll be asked to provide details like director and shareholder information and, importantly – your company’s SIC code (Standard Industrial Classification). For property investment, most people use:
- 68100 – Buying and selling of own real estate
- 68209 – Other letting and operating of own or leased real estate
Choosing the correct code is vital, especially if you’re planning to apply for a mortgage through your SPV.
Step 3: Decide on Shareholding
Will you be the sole shareholder? Or are you planning to share ownership with a partner, spouse, or even a friend? Think carefully here – especially when it comes to long-term plans like tax, profit distribution, or inheritance.
Step 4: Open a Business Bank Account
Don’t skip this! Keeping your SPV’s finances separate from your personal finances is key. Not only is it cleaner for accounting, but it’s also required by most lenders.
Step 5: Register for Corporation Tax
Once your company starts trading (which includes buying a property), you need to register with HMRC for corporation tax within three months.
Step 6: Keep on Top of the Admin
From filing annual accounts and Confirmation Statements to submitting tax returns, running a company comes with responsibilities. Many investors team up with accountants who specialise in property to take the pressure off and make sure nothing gets missed.
Conclusion
If you’re serious about getting into property, setting up an SPV might be one of the smartest moves you can make. It’s a structure that gives you more control, better tax treatment, and peace of mind – especially if you plan to grow your portfolio over time.
Just make sure you get it right from the start. Whether you’re buying one rental property or planning a full-blown investment business, taking the time to set up SPV property limited company properly can save you hassle, money, and headaches down the line.
Need help? It’s worth speaking to a specialist who understands both the property market and company structures. After all, every good investment starts with a solid foundation.
