The 2025 Budget will be remembered for many things, but the slip-up that ironically saw the Office for Budget Responsibility figures released minutes before the Chancellor stood up set the tone.
It was a shaky start to a day that brought a raft of tax freezes and increases to boost government revenue, with landlords once again in the government’s sights.
The additional 2% tax rise on rental income from April 2027 means the tax gap between personal and company buy-to-let ownership could make limited companies more attractive. [1]
Incorporated structures are likely to look more appealing, and the Budget has tipped the scales further in that direction.
As ever, landlords will need to seek advice to weigh up the potential Stamp Duty and Capital Gains Tax payable in a limited company structure against the costs and administration of the vehicle itself. For those with one or two properties or plans to sell, the sums can always pull in the other direction.
But, what is clear is that the Budget has made holding rental property under personal ownership less attractive overall. Any shift to a company needs careful planning, but more landlords are likely to look at this route.
A CHANGING REGULATORY LANDSCAPE
Alongside tax changes, landlords are already on a step-by-step path to a new framework under the Renters Rights Act, with councils gaining enforcement powers from December 2025.[2]
Brokers are already likely to be seeing how this shapes demand. For many, limited company structures may offer more control at a time when personal ownership is under pressure.
This year, Finova research revealed three-quarters of brokers reported a marked rise in limited company enquiries. [3] The same data suggested almost half of brokers say flexibility for these complex borrowers is the biggest area where lenders fall short, with speed of service next at 43%. So, finding the right lender to partner with continues to be a point of tension in a market where cases often need quick responses and careful individual assessment.
Moneyfacts data confirms how quickly the limited company buy-to-let lending mortgage sector has grown. [4] Two years ago, landlords had fewer than 300 two-year fixed company products to choose from, rising to more than 770 at the start of October 2025. Five-year options have also risen sharply and rates have fallen from 2024’s peaks.
We joined the drive for greater competition in November when we launched into limited company buy-to-let to give brokers more flexibility and clear criteria.
With no minimum income or ownership period and support for first-time landlords this reflects the rise of newer, younger investors entering the market. Holiday lets, which we also consider, remain a major area of growth allowing landlords to diversify income and build portfolio equity.
A CLEAR PATH FOR 2026
Certainty will always matter to landlords planning growth in a period of change. Brokers want lenders who can support new tax efficient structures, move fast on cases and adjust to new rules.
With Budget pressure on personal ownership, rental reform on the way and more landlords incorporating each month, demand for limited company products looks set to rise again in 2026.
Lenders who can offer flexibility and the efficiencies of technology-backed case handling are well-positioned to help brokers in this new era.
Chris Blewitt is head of intermediaries at Darlington Building Society
Sources:
[1] As announced at Budget 2025, the government will introduce legislation in Finance Bill 2025-26 to create separate tax rates for property income. From 2027 to 2028, the property basic rate will be 22%, the property higher rate will be 42%, and the property additional rate will be 47%. To take effect from April 2027: https://www.gov.uk/government/publications/budget-2025-overview-of-tax-legislation-and-rates-ootlar/budget-2025-overview-of-tax-legislation-and-rates-ootlar
[2] Renters Rights Act. Local councils gain enforcement powers on 27 December 2025: https://blog.goodlord.co/renters-rights-bill-a-letting-agents-guide#:~:text=Stronger%20investigatory%20powers,deposit%20schemes%20to%20support%20investigations.
[3] Three-quarters of brokers report rising demand for limited company BTL over the past year. 12 November, 2015: https://www.finova.tech/blog/three-quarters-of-brokers-report-rising-demand-for-limited-company-btl-over-the-past-year-reveals-finova?utm_source=chatgpt.com
[4] More limited company buy-to-let mortgages available. Rachel Springall. 3 October 2025: https://moneyfactscompare.co.uk/news/mortgages/more-limited-company-buy-to-let-mortgages-available/
