"As landlords have adjusted to being taxed on gross rental income, incorporation has become an increasingly attractive and often necessary route to maintain profitability"
- Louisa Sedgwick - Paragon Bank
Limited company landlords accounted for a record proportion of house purchase transactions funded with a buy-to-let mortgage in 2025, according to analysis of industry data by Paragon Bank.
Limited companies represented 43% of mortgaged buy-to-let house purchases during the year, up from 35% in 2024. The share has risen consistently since 2018, when limited company structures made up just 7.5% of completions.
The shift follows changes to the tax treatment of rental income introduced in 2017, which moved landlords onto taxation based on gross rental income. Before April 2017, landlords holding property in their personal name could deduct mortgage interest and finance costs from rental income. That allowance was phased out and replaced with a 20% tax credit.
Industry house purchase data mainly reflects landlords buying property, although it also includes transactions where landlords transfer homes from personal ownership into a limited company structure.
The use of limited companies has also increased in the remortgage market. During 2025, 11.5% of completed buy-to-let remortgages were made through limited company landlords, up from 10% in 2024 and 1.30% in 2018.
Separate figures from Companies House highlight the scale of incorporation linked to property investment. Just under 50,000 companies were established in 2025 for the purpose of buying and selling their own real estate, the most common SIC code used by landlords applying for buy-to-let finance via a limited company. In total, 49,029 companies were incorporated for this purpose during the year, compared with 45,775 in 2024.
Companies House data also shows that 274,315 businesses are active in buying and selling their own real estate. This exceeds the number of incorporated and active businesses in the hospitality industry.
“The continued rise in limited company buy-to-let activity reflects the structural shift we’ve seen in the market since the 2017 tax changes,” said Louisa Sedgwick, Paragon Bank managing director of mortgages (pictured).
“As landlords have adjusted to being taxed on gross rental income, incorporation has become an increasingly attractive and often necessary route to maintain profitability."
“Limited company structures can potentially not only offer more efficient tax treatment but also provide greater flexibility for portfolio growth and long-term planning. The record share of purchases and remortgages completed through limited companies in 2025 underlines how deeply this trend is now embedded in the sector, and it is one we anticipate will continue.”
Survey data from Paragon Bank support this shift in ownership patterns. A study of more than 500 landlords found that nearly one in three, or 29%, hold their properties exclusively through a limited company structure.
Ownership models are increasingly mixed:
36% of landlords split ownership between limited companies and personal names.
65% have created at least one Special Purpose Vehicle (SPV) for buy-to-let investment.
Age also appears to influence adoption. Among landlords aged 25 to 34, 57% of properties are held in limited companies, while 43% are owned through a mix of corporate and personal structures.
In the 35 to 44 age group, limited company holdings fall to 46%, with a further 39% held across both structures. Adoption continues to decline gradually as landlord age increases.
Paragon Bank said experience and track record remain key considerations for landlords choosing lenders in this part of the market.
“Paragon has a long history of supporting limited company landlords, and the proportion of incorporated completions on our own book is significantly higher than the broader market,” concluded Paragon Bank mortgages head of sales and retention, Jason Wilde, “Landlords looking for a lender for limited company transactions need to consider that organisation’s track record in this segment of the market.”
