Company (as an ownership structure)

A company is a separate legal entity with its own legal personality, able to own property in its own right, with shareholders holding the equity.

How it works for property

The company owns the property and files its own return, taxed at the company rate. Profits reach shareholders as dividends, with imputation credits attached.

Companies are registered with the Companies Office and governed by the Companies Act 1993\.

Advantages

• Limited liability, in principle
• A flat company tax rate, which may be below a high marginal rate
• Easier to bring in or change shareholders
• Suits trading and development activity

Disadvantages

• Losses are trapped in the company and cannot flow to shareholders — which is why LTCs exist
• Annual compliance cost
• Lenders almost always require personal guarantees, which substantially undercuts the liability protection
• No main home exclusion

Common misunderstanding

Limited liability is limited in practice. Once you have signed a personal guarantee for the lending, your exposure looks a lot like personal ownership.

Companies suit trading, not usually passive residential holding. For a long-term rental portfolio, personal name, LTC or trust is more commonly appropriate.

Related terms

Last reviewed: 1 August 2026 · General information only, not tax advice.

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