Sam Inkersole explores the implications of incorporating a personally held property portfolio in light of the changes to the corporation tax (CT) regime announced by the Chancellor in the March 2021 Budget and considers whether these changes should make property owners think twice before incorporating.
Shortly before the Chancellor’s Budget on 3 March 2021, rumours were circulating that the corporate tax rate was going to increase from 19%. The announcement of large increases in the rate of corporation tax (CT) to a main rate of 25% from 1 April 2023, coupled with the marginal tax rates for companies with profits of less than £250,000 per year, surprised many in the tax profession.
The topic of this article was among a number of questions which passed through my mind on Budget day.
Refresher on property income taxation and incorporation
The basic premise of a
