Reduce tax on rental property

Afternoon guys

Its my first post but let me say this website is amazing and I've been reading the forum daily. I've only been in practice a year now so still finding my feet.

Anyway a client came in today and asked if the following scenario was possible in order to reduce his income tax bill. He currently has 8 properties out on rent for which the mortgage interest rates are very low so his rental income is quite high.

He is thinking of forming a ltd company and then renting the properties to the ltd company for a small sum (just enough to cover his mortgage and a bit of expendature) then using the ltd company to rent the property out again to the tenants through a letting agents.

Although I can see the saving would be significant as he is a high rate tax payer currently, would this foul of any legislation?

I dont want to give him any wrong advice so I said I'll look into it for him before he goes ahead with it. Any ideas? Thanks in advance