If you have been looking into buy-to-let investment in the UK, you have probably come across the term SPV. More landlords and investors are now buying property through a limited company rather than in their own name, and the SPV structure sits right at the heart of that shift.
Whether you are buying your first investment property or you already own a portfolio, getting the structure right from the start matters enormously. The wrong setup can cost you access to mortgage products, create tax headaches, and complicate things further down the line.
This guide explains what an SPV is, how to set up an spv company, why investors use one, and exactly how to set one up in the UK. We have also included the latest fees, SIC codes lenders actually accept, and the tax points that most guides get wrong or leave out entirely.
Important: This article is for general information only. Tax law, lender criteria, and Companies House fees can and do change. Always take advice from a qualified accountant before making decisions about your investment structure.
What Is an SPV Company?
SPV stands for Special Purpose Vehicle. In the context of property investment, it is simply a limited company that has been set up for one specific purpose: to buy, hold, and manage property.
The key word is “special.” Unlike a general trading company that might buy and sell goods, offer services, or do a range of things, an SPV has a narrow, defined purpose written into its structure. This clarity is important because lenders, accountants, and solicitors all need to understand exactly what the company does when they are working with it.
SPVs are registered with Companies House just like any other limited company. From a legal standpoint, there is nothing particularly exotic about them. What makes them an SPV is the combination of their stated purpose, the SIC codes used at registration, and how they are operated day to day.
How lenders view SPVs
Buy-to-let mortgage lenders who offer company products generally want to see a clean, focused structure. An SPV with the right SIC code, no unrelated trading history, and directors who can demonstrate experience or income gives lenders a clear picture of what they are lending against.
Lenders who offer SPV mortgages typically check the SIC code at the point of application. Using the wrong code, or having a company that looks like a general trading business rather than a property vehicle, can result in a declined application or being pushed toward less competitive products.
SPV versus a standard limited company
The difference is mostly about purpose and perception. A standard limited company can hold property, but it may also be doing other things. An SPV has been set up with property investment as its sole reason for existing, which gives lenders, accountants, and any future investors a cleaner baseline to work from.
Benefits of Setting Up an SPV for Property Investment
There are several genuine reasons why landlords choose this route. None of them are guaranteed wins for every investor, which is why professional advice before you set anything up is not optional.
Tax considerations
Companies pay Corporation Tax on their profits rather than Income Tax. The headline rates for the current tax year (2025/26) are 19% for profits up to £50,000 and 25% for profits above £250,000. There is a marginal relief band in between.
For a higher-rate Income Tax payer being taxed at 40% or 45% on rental profits personally, those rates can look attractive at first glance. However, there is a critical point that many articles miss and that you absolutely need to discuss with an accountant before proceeding.
A property SPV may be classified as a Close Investment-Holding Company (CIHC). A CIHC is a close company whose main activity is holding investments rather than actively trading. Many residential buy-to-let SPVs fall into this category. If HMRC classifies your company as a CIHC, it pays Corporation Tax at the full 25% main rate on all profits, regardless of size. The 19% small profits rate and marginal relief do not apply.
Whether your SPV is treated as a CIHC or not depends on the specific facts: what you own, who you rent to, whether there is any active management, and how the company’s purposes are structured. This is one of the most important tax points to clarify with a property accountant before you invest through a company.
Separately, companies are not subject to the Section 24 mortgage interest restriction that applies to individual landlords. A company can deduct mortgage interest as a business expense when calculating taxable profits. For some investors, this is one of the most compelling reasons to use a company structure.
Access to specialist mortgage products
A growing number of specialist lenders offer buy-to-let mortgage products specifically designed for SPV companies. Setting up your company correctly from the start, particularly getting the SIC code right, is what opens the door to those products.
That said, the range of company buy-to-let mortgages is still narrower than the personal buy-to-let market, and rates are sometimes higher. A whole-of-market mortgage broker who works with company landlords will give you a realistic picture before you commit.
Separation of assets
Because an SPV is a separate legal entity, its assets and liabilities sit apart from your personal finances. This is often described as a protection benefit, and while that is broadly true, it comes with an important qualification. Most buy-to-let lenders will require personal guarantees from the company’s directors. That means your personal liability is not entirely removed in practice.
Planning for the future
A company structure can provide more flexibility when it comes to succession planning, bringing in other investors as shareholders, or passing wealth on to family members. This needs to be built into the company’s structure from the beginning, ideally with input from a solicitor experienced in property and estate planning.
Step-by-Step Guide to Set Up an SPV Company
Step 1: Choose a company name
Your company name must be unique and cannot be the same as or too similar to an existing registered company. You can check availability free of charge on the Companies House name availability tool at gov.uk. Avoid names that suggest regulatory authority or accreditation you do not hold.
Step 2: Select the correct SIC codes
SIC codes tell Companies House and lenders what your company does. For property SPVs, getting this right is one of the most important steps. The wrong code can close the door to specialist mortgage products before you have even started. See the dedicated SIC codes section below.
Step 3: Register with Companies House
As of 1 February 2026, the cost of registering a company online with Companies House is £100. Registration typically completes within 24 hours of a digital application. You will need a registered office address, which must be a physical UK address. A PO Box alone is not sufficient. From November 2025, all new directors are also required to complete identity verification with Companies House as part of the Economic Crime and Corporate Transparency Act reforms.
Step 4: Appoint directors and shareholders
Every limited company must have at least one director. Before you finalise who the directors and shareholders are, speak to a solicitor or tax adviser. The shareholding structure has direct implications for how profits are distributed, how future investors might come in, and how the company fits into your wider estate planning.
Step 5: Open a dedicated business bank account
This is non-negotiable. Your SPV must have its own business bank account, completely separate from your personal finances. Every transaction related to the property should go through this account. Mixing personal and company money creates serious problems for your accountant, your tax position, and potentially your mortgage lender.
Step 6: Register for taxes
Your company must register for Corporation Tax with HMRC within three months of starting to trade. You can do this online through your Government Gateway account. For most residential property SPVs, VAT registration is unlikely to be required because residential rental income is exempt from VAT. However, if your company’s taxable turnover exceeds the current VAT threshold of £90,000 in a rolling 12-month period, you must register. Speak to your accountant about whether any of your company’s activities could create a VAT obligation.
Step 7: Prepare your documentation for mortgage applications
Lenders will want to see your company’s Certificate of Incorporation, the Memorandum and Articles of Association, and evidence that the company’s objects permit property investment. Most will also require personal financial information from all directors, including income evidence, bank statements, and a credit check. If you already own properties, you may need to provide details of those too.
SIC Codes Commonly Used for Property SPVs
Standard Industrial Classification (SIC) codes tell the world what your company does. When you register with Companies House, you choose the code or codes that best describe your intended activity.
For property SPVs, the codes that specialist buy-to-let lenders most commonly accept are:
| SIC Code | Official Description | Most Suitable For |
|---|---|---|
| 68100 | Buying and selling of own real estate | Property trading, development, flipping |
| 68209 | Other letting and operating of own or leased real estate | Residential buy-to-let portfolios |
| 68320 | Management of real estate on a fee or contract basis | Property management activity |
For a standard residential buy-to-let SPV, 68209 is the most widely accepted code among specialist lenders. Some lenders also accept 68100. A small number of lenders are flexible about which codes they accept, while others are strict. Always confirm which codes your intended lender accepts before you register, or work with a mortgage broker who can check this for you.
You can register more than one SIC code if your company will carry out more than one type of activity, but for a clean SPV structure, most investors stick to the single most relevant code.
SPV Mortgage Requirements
Not all buy-to-let mortgage lenders offer products to limited companies or SPVs. The market has expanded significantly over the past few years, but it is still more limited than the personal buy-to-let market. Here is what lenders who do offer SPV mortgages will typically look for:
- An appropriate property-related SIC code registered at Companies House
- Articles of Association that explicitly permit property investment
- Personal guarantees from all directors and shareholders with a significant shareholding
- A deposit of at least 25% of the purchase price, though this varies by lender and property type
- Rental income that meets the lender’s stress test, usually requiring the projected rent to exceed the mortgage payment by a defined margin
- Personal income and credit history for all directors
- Business bank statements once the company has any trading history
Common mistakes to avoid when applying for an SPV mortgage
- Approaching mainstream high-street lenders who do not offer company buy-to-let products at all
- Registering with the wrong SIC code and finding out at application stage
- Not using a specialist mortgage broker who works with company landlords
- Assuming that all SPV mortgage products have the same criteria, when they vary considerably between lenders
Costs of Setting Up an SPV Company in the UK
| Item | Current Cost | Notes |
|---|---|---|
| Companies House online registration | £100 | As of 1 February 2026 |
| Same-day registration | £156 | As of 1 February 2026 |
| Annual confirmation statement | £50 per year | Digital filing, as of 1 February 2026 |
| Formation agent or solicitor | From around £100 | Optional but often worthwhile |
| Registered office address | From around £50 per year | If you use a virtual address service |
| Accountancy fees | Varies | Annual accounts, Corporation Tax return, bookkeeping |
The registration fees listed above were updated by Companies House on 1 February 2026 and may change again. Professional fees charged by accountants, company formation agents, or other service providers are separate from Companies House fees and may vary depending on the circumstances of your application, the level of support required, the complexity of the company structure, compliance requirements, and any additional services requested. Quotes should be obtained directly from the relevant service provider before engagement.
Beyond the initial setup, running an SPV involves ongoing costs. These include annual accounts, a Corporation Tax return, the annual confirmation statement filing, and day-to-day bookkeeping. The cost of accountancy will vary depending on the complexity of your portfolio and the firm you use. Budget for this from the start, as these are genuine business costs that most investors underestimate.
Common Mistakes to Avoid
- Using the wrong SIC code. This comes up again and again because the consequences are significant. Some investors register a generic SIC code without realising it, then find that their preferred lender will not accept the application. Check before you register.
- Mixing personal and company finances. Once you have a business bank account, use it exclusively for company transactions. Every time rental income lands in your personal account, or you pay a company expense from personal funds without properly recording it, you create work for your accountant and potential problems if HMRC ever asks questions.
- Assuming the company structure is automatically tax-efficient. It often can be, but it depends heavily on your personal tax position, how much profit you retain versus extract, whether your SPV is classified as a CIHC, and your overall financial situation. Take proper advice before assuming you will save tax.
- Ignoring SDLT costs on purchase. When a company buys a residential property in England, it pays the standard SDLT rates plus the additional dwelling surcharge, which currently stands at 5% on top of the standard rates. For residential properties purchased by a company for over £500,000, a flat 17% SDLT rate applies. These are material costs that need to be built into your investment calculations from the start.
- Not keeping proper records. Limited companies have strict legal obligations to maintain accurate financial records, file accounts on time, and submit annual returns. Falling behind on these is not just an administrative headache. It can result in financial penalties and can damage the company’s standing at Companies House.
Is an SPV Right for You?
Where it can work well
An SPV structure tends to make most financial sense for investors who are already paying higher or additional rate Income Tax, who plan to hold properties for the long term, and who intend to retain profits within the company rather than drawing everything out immediately. It can also be a useful structure for investors who want to involve family members, plan for inheritance, or build a portfolio with a view to passing it on.
Where it may not be the right fit
If you are a basic rate taxpayer, the tax savings are less clear-cut, particularly once you factor in the cost of additional accounting, the SDLT surcharge on purchase, and the complexity around extracting profits. Investors who plan to sell properties in the short term also need to think carefully, as selling through a company has its own Capital Gains Tax and profit extraction implications.
Pros at a glance
- Corporation Tax on profits rather than personal Income Tax rates
- Mortgage interest fully deductible as a business expense
- Access to specialist SPV buy-to-let mortgage products
- Separate legal entity keeps property assets distinct from personal assets
- Can be structured to help with long-term estate and succession planning
Things to factor in
- Additional dwelling SDLT surcharge (currently 5%) applies on every company purchase
- Flat 17% SDLT rate on residential properties above £500,000 purchased by a company
- More limited mortgage product choice compared with personal buy-to-let
- Personal guarantees from directors are almost always required
- Ongoing accounting and compliance costs
- Profit extraction through salary or dividends creates its own tax considerations
- Your SPV may be classified as a CIHC, affecting which Corporation Tax rate applies
The right answer depends on your personal tax position, your long-term goals, and how you plan to manage the portfolio. It is a conversation worth having with a property-specialist accountant before you commit to any structure.
Frequently Asked Questions
Can I transfer existing properties into an SPV?
You can, but it is rarely straightforward. When you transfer a property from personal ownership to a company, HMRC treats it as a sale. This means Stamp Duty Land Tax is payable at company rates on the transfer value, and Capital Gains Tax may also apply on any increase in value since you purchased the property. There is no automatic relief just because you are moving the asset into your own company. In some limited circumstances, there are planning strategies that may reduce the cost of incorporation, but these are complex and highly fact-specific. Always take specialist legal and tax advice before proceeding.
Do all lenders accept SPVs?
No. Many mainstream lenders do not offer buy-to-let products to limited companies at all. The specialist lenders who do offer SPV mortgages will each have their own criteria around SIC codes, director experience, deposit requirements, and rental stress tests. The market continues to evolve, so using a whole-of-market mortgage broker who works specifically with company landlords is the most efficient way to find out what is currently available to you.
Can an SPV own more than one property?
Yes. There is no legal restriction on an SPV owning multiple properties, and many investors use a single SPV to build a portfolio over time. Some investors choose to set up a separate SPV for each property so that lenders have a clean view of each asset and any financial difficulties with one property do not affect the others. Each approach has advantages and additional costs. The right answer depends on your specific situation, your lender’s preferences, and your long-term plans.
How long does it take to set up an SPV?
The Companies House registration itself typically completes within 24 hours for an online application. However, opening a business bank account, putting your accountancy arrangements in place, and getting mortgage-ready can take several weeks in total. If you are planning to move quickly on a property, set up your SPV well in advance rather than trying to rush the process once you have an offer accepted.
Do I need an accountant for my SPV?
While there is nothing stopping you from managing the compliance yourself, in practice most investors use an accountant, and for good reason. Limited companies must file annual accounts with Companies House, submit a Corporation Tax return to HMRC each year, and maintain accurate records throughout the year. A property-specialist accountant will also help you structure profit extraction tax-efficiently, flag any CIHC classification issues, and ensure you are not missing reliefs or making avoidable errors. The cost of a good accountant is typically worth it many times over.
Conclusion
Setting up an SPV company for property investment is not complicated in itself. Registering a company with Companies House takes 24 hours. What takes more time and care is making sure the structure is right for your situation, the SIC code is correct, the tax implications are fully understood, and the mortgage strategy is in place before you start.
The potential benefits are real: a more tax-efficient way to hold rental profits, access to specialist mortgage products, and a cleaner structure for building and eventually transferring a portfolio. But those benefits come with genuine costs and complexities that need to be factored in from the beginning.
If you take one thing from this guide, make it this: get proper advice before you set anything up. The cost of a conversation with a qualified accountant, solicitor, and mortgage broker is small compared with the cost of undoing a poorly structured investment down the line.
