BTL2021: Tax adviser referrals gave brokers £5m+ portfolios to incorporate – Paragon

  • 22/04/2021
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BTL2021: Tax adviser referrals gave brokers £5m+ portfolios to incorporate – Paragon
Building working relationships with tax advisers is vital for brokers to serve limited company landlord clients and can be potentially highly profitable, the Buy to Let Online Forum has heard.


Speaking during the event, Paragon national sales manager Jason Wilde (pictured) revealed the lender had dealt with several multi-million pound cases from brokers originated through tax specialists.

“There has never been a better time for intermediaries to forge working relationships with accountants and tax specialists,” he said.

“We’ve had a number of £5m+ portfolios and incorporations which have been introduced to brokers by accountants and tax advisers.”

Wilde noted that with the eradication of mortgage interest relief for landlords this had caused another wave of landlords to consider their tax position and potentially incorporate their portfolios.

“With section 24 being fully implemented this year there will be a number of landlords facing yet another increase in their taxable incomes. This has driven a demand in limited company borrowing,” he added.

Aldermore national sales manager Matt McCullough agreed, noting that he thought the rate of incorporating will increase over the next 12 months, as the pre-tax changes peak of five-year fixed rate deals in 2016 would be starting to mature.

“So this will be a big time for it,” he said.


Four keys to limited company buy to let

And McCullough emphasised the importance of clients getting tax advice first, then going to the intermediary for mortgage advice before bringing them together. He concluded his presentation with the four key points for undertaking limited company BTL. They were:

  • Get yourself set up and linked with a tax adviser. Why? To make this whole process easier. Clients get the right advice but actually it also links with the mortgage so it all works smoothly. And it’s also a good referral lead for you both.
  • Get familiar with all the acronyms that are used in company buy to let, SPVs, the different fixed costs that are there, debentures, floating charges, personal guarantees, all of that stuff. Do a bit of reading up to ensure you know exactly what’s being talked about when a lender asks for certain things.
  • It might sound quite obvious, but reach out to your current landlords that are on your book and understand where they are in this journey. Is it something that you need to prepare for if they are going to come to you in a few months’ time with a business plan like this to incorporate.
  • Lastly, there’s so many great business development managers (BDMs) in the market that know this stuff inside out. Speak to them about any concerns that you’ve got and they will absolutely help educate you in this area of the market if you’re not quite upskilled there just yet.


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