I have existing clients where they buy properties to rent out so this is something I havent come across.
New client buys properties to develop and then sell.
They have been approached by someone saying that they wish to rent a property instead and after speaking to their mortgage advisor, they have been advised that in order to get the best buy to let mortgages, they need to set up a 'special purchase vehicle'.
I now know this to mean setting up a new company and transferring the property into that.
Do I incorporate (100% owned by original company) and then transfer the property at market value? If so, I assume SDLT is payable?
Also, from what I have read online the SIC codes have to specifically be the following in order to comply with the mortgage lenders requirements:
68100 – Buying & sell own real estate
68201 – Renting & operating of housing association real estate
68209 – Other letting & operating of own or leased real estate
68320 – Management of real estate on a fee or contract basis
I assume this is a fairly regular occurrence just something I haven't been asked before.
Thanks in advance.