Record variety of buy-to-let firms arrange in 2025, regardless of traders shopping for smaller share of properties

A record number of buy-to-let companies were set up last year, according to analysis by property firm Hamptons.

Companies House records show 66,587 new companies were formed to hold buy-to-let property in 2025.

This represents an 8 per cent increase on 2024’s total of 61,517 and a 363 per cent rise over the last decade. 

This rise comes despite investors accounting for a smaller share of home purchases. 

Across the UK, investors bought 10.8 per cent of homes in 2025, down from 11.9 per cent the year before.

Hamptons says that more than three-quarters of new buy-to-let purchases are made through limited companies.

Why are landlords using limited companies? 

Holding property in a limited company, also known as ‘incorporating’, is an alternative to holding property in one’s personal name.

It can come with various tax advantages, including the fact corporation tax – payable in a company structure – is lower than income tax, which is payable for landlords who own properties in their own name.

This allows landlords to build up profit within the company, which they can use to re-invest towards another property sooner than they might otherwise have done if owning in their own name. 

Owning in a limited company also allows property investors to fully offset all of their mortgage interest against their rental income, before paying tax.

This differs from landlords who own property in their own name. They only receive tax relief based on 20 per cent of their mortgage interest payments.

This is less generous for higher rate taxpayers, who previously received a 40 per cent tax relief on mortgage costs before a 2016 rule change.

A higher-rate taxpayer landlord with mortgage interest payments of £500 a month on a property rented out for £1,000 a month now pays tax on the full £1,000, with a 20 per cent rate on the £500 that is being used towards the mortgage.

A landlord who owns in a limited company with mortgage interest payments of £500 a month on a property rented out for £1,000 a month would only pay tax on £500 of that income.

Put simply, it means that whilst individual landlords are effectively taxed on turnover, company landlords are taxed purely on profit.

‘Landlord’s shift towards limited company ownership continued through 2025 and shows little sign of slowing this year,’ said Aneisha Beveridge, head of research at Hamptons.

‘While the tougher tax treatment introduced in 2016 sparked the initial move into corporate structures, five years of frozen personal allowances, combined with the impact of higher mortgage rates, which company landlords can fully offset against their tax bill, have fuelled the more recent surge. 

‘As more landlords find themselves pulled into the 40 per cent income tax bracket, paying corporation tax at 19 per cent or even 25 per cent has become increasingly attractive.’

1.5 million properties with a limited company  

The incorporation momentum has carried into 2026, according to Hamptons, with 5,922 new buy-to-let limited companies set up in January 2026 – 11 per cent more than the same month last year, suggesting the trend shows little sign of slowing. 

Limited companies increasingly enable co-investment, according to Hamptons. The 66,587 companies formed in 2025 were owned by 103,280 shareholders. 

Notably, 42 per cent of companies established last year had more than one shareholder, up from 34 per cent in 2016.

By the end of 2025, the total number of buy-to-let companies registered with Companies House had reached 443,272, nearly five times the 91,278 recorded in 2016.

Across England and Wales, there are now 755,042 property titles held in a buy-to-let company, up from 272,964 a decade ago. 

Hamptons estimates there to be around 1.5 million buy-to-let properties within a limited company structure.

London money flowing north

While 31 per cent of these companies have their headquarters in London, their portfolios span far beyond the capital. 

Just over half of purchases made by London-based companies are located outside the capital, according to Hamptons.

London-based companies now own more property titles in the East of England, South East, North West and North East than all other companies investing there from outside the region.

Is using a company always the right choice?

It’s not actually quite as black and white as the data would suggest.

Whether there is an advantage to be had or not depends on the landlord’s individual circumstances.

For example, lower-rate taxpayers, particularly if they don’t have a big mortgage on their buy-to-let, may be better off holding their buy-to-let in their personal name.

There are also the added mortgage costs to take into account when buying via a limited company, as lenders usually charge higher rates and bigger fees – so while a landlord might be saving on their tax bill, they may also be paying more to their mortgage lender.

Finally there is an added layer of bureaucracy that comes with a company structure. Company accounts must be formally prepared and filed, records maintained, and directors appointed.

This creates more work for landlords choosing the limited company route, and an added cost if they use an accountant.

Aneisha Beveridge of Hamptons added: ‘Today, limited company ownership makes financial sense for the majority of landlords, with around 75 per cent to 80 per cent of all new buy-to-let purchases now made via a company. But it isn’t a one-size-fits-all approach. 

‘For landlords who earn no income beyond their rents and remain lower-rate taxpayers, owning property in personal names can still be the better option, particularly as above-inflation increases have pushed up Companies House filing fees.’