Accountants and Bookkeepers in Malvern - Turl & Co

What is an SPV for Landlords?


Commercial mortgage providers who lend to landlords will usually request that the company applying for finance is an SPV.  This is short for ‘Special Purpose Vehicle’ and simply means that it is a company that has been set up using specific SIC codes at Companies House.

A SIC code is short for Standard Industrial Classification and is a classification of the Companies trade or activity.  In this case the SIC codes used must be for the letting of property and lenders often require specific SIC codes to be used.

The company must only be used for acquiring and letting property and must not undertake and trading activity.

Whilst a commercial lender may consider lending to a company that is trading, it can often cause complications and is harder for the underwriter as there may be many things to consider, whereas with a company set up specifically for acquiring property it is usually very straight forward.

From an accounting point of view, there is no different treatment of a SPV company to a regular trading company.  Accounts and corporation tax returns still need to be completed and filed as with any regular company.

We have a growing panel of mortgage brokers, property advisors and other professionals with whom we work so that we can always point you in the right direction when you are thinking of investing in property and our tax specialist, Karen Lowen, can talk you through your options, any tax implications and even form the SPV company for you.  If you are considering property as an investment come and see us.

 

 

 

 

 

 

 

 

 

 

 

Tags: SPB mortgages | Landlords


By: Karen Lowen
On:31-07-2019
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