Rent from yourself, can you claim as expense?

[contractor79]

If you bought a property through a different Ltd company from the one you contract through... then rented from that company... can you claim that rent as expense?

Surely it's not that dodgy. You kind of have a group relationship?

[ASB]

If you bought a property through a different Ltd company from the one you contract through... then rented from that company... can you claim that rent as expense?

Surely it's not that dodgy. You kind of have a group relationship?

In principle yes. Whether it would achieve anything useful is questionable, it would just be a transfer of income from A to B in respect of a service provided. A gets relief on the rent, B gets taxed.

[Nixon Williams]

If you bought a property through a different Ltd company from the one you contract through... then rented from that company... can you claim that rent as expense?

Surely it's not that dodgy. You kind of have a group relationship?

If you already have the separate company, the level of profits subject to the lower rate of corporation tax will be £150,000 rather than £300,000 - this may not be an issue but you should bear this in mind.

As ASB stated not sure why you would want to do this but as I do not have all the facts there maybe a good reason?

If you do proceed the rent would have to be at a commercial rate and not an artificial amount in order to move profits.

Alan

[northernladuk]

Two things that strike me here are why would you purchase a property through a company anyway. I thought reading most posts when this comes up in conversation that in a vast majority of cases there is no reason to do this due to tax on profits and so on..

Second is that if you have done it for whatever reason you will have to be ridiculously clean and transparent about it. In theory it shouldn't be a problem but recent events have made this look more like a complete fudge that a valid solution. I am sure anyone investigating this situation would be asking a lot of questions about need, values being charged (particulary if people are taking the piss with relation to market value etc). If I was in your situation I would make abosultely sure it is the best solution, done properly and values are at market rate etc....