SomethingIf you are new to property investment, you may have heard other investors talk about setting up an SPV company. It might sound complicated, but an SPV is actually a straightforward and powerful way to structure your investments for tax efficiency, simpler financing and long-term growth.
In this guide, we explain what an SPV company is, why so many property investors choose one, and how Sourced Enterprise can help you set up your SPV quickly and correctly.
What Is an SPV Company for Property Investment?
An SPV (Special Purpose Vehicle) is a limited company set up for a single, specific purpose. In property investment, that purpose is usually to buy, hold and manage investment properties.
An SPV is different from a general trading company because it is solely focused on property investment activities. It might own buy-to-let properties, HMOs or commercial units, but it will not run unrelated businesses. This clear, ring-fenced structure makes it easier to manage your portfolio and deal with lenders.
Why Property Investors Use an SPV
1. SPV Mortgage Benefits
Most buy-to-let lenders prefer working with SPV companies. Because the company’s only purpose is property investment, it is easier for lenders to assess risk and approve applications.
2. SPV Tax Advantages
Owning property through a limited company can allow more flexible tax planning. Depending on your circumstances, you may be able to reinvest profits at the corporation tax rate and manage your income in a more tax-efficient way.
3. Clearer Financial Management
With an SPV, all property-related income and expenses are kept separate from your personal finances or other businesses. This makes accounting simpler and more transparent.
4. Flexible Ownership Structures
If you invest with partners, an SPV allows you to issue shares that clearly define each investor’s ownership percentage.
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Pro Tip: When learning how to set up an SPV, it is important to get the details right, such as choosing the correct SIC codes. Mistakes can limit your mortgage options or create tax complications later.
How Sourced Enterprise Helps You Set Up an SPV
Creating an SPV is not difficult, but it is easy to make costly mistakes if you do not know the property investment rules. That is where Sourced Enterprise can help.
We specialise in setting up SPV companies specifically for property investors. Our service includes:
- Selecting the correct SIC codes for property investment so lenders recognise your business
- Structuring the company for multiple shareholders or joint ventures
- Offering guidance on best practices for property accounting from day one
Set up your SPV the right way. Speak to our team today and start your property journey with a solid foundation.
When to Set Up an SPV
If you plan to build a property portfolio, it is best to set up your SPV before buying your first property. This allows you to access the widest range of SPV mortgage products and keep your investment structure clean from the start.
Take Action Today
An SPV company can make property investing easier, more tax-efficient and more attractive to lenders. It is one of the simplest but most effective tools for growing a property portfolio.
Book your free consultation with Sourced Enterprise and get your SPV company set up quickly, correctly and tailored to your investment goals.
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