A record 66,587 buy-to-let limited companies were incorporated in 2025 due to more landlords turning towards corporate ownership as tax and financing pressures reshape the private rental sector.
Analysis of Companies House data by Hamptons shows last year’s total was 8% higher than the previous record set in 2024 and 363% above the level seen a decade ago.
By the end of 2025, 443,272 buy-to-let companies were registered – almost five times the 91,278 recorded in 2016.
Buy-to-let firms were the UK’s second most common type of new business formed in 2025, behind only mail-order companies and ahead of management consultants, according to the analysis.
NEW RECORD
Incorporations peaked at 6,493 in September, the highest monthly figure on record, with more than 5,000 new companies created in 10 of the 12 months. The momentum has continued into 2026, with January incorporations running 11% above the same month last year.
The growth reflects structural tax changes introduced from 2016 when mortgage interest relief began to be phased out for higher-rate taxpayers holding property in personal names. Limited companies, by contrast, can offset mortgage interest in full against corporation tax.
The prolonged freeze in personal tax thresholds has further accelerated the shift. With the personal allowance and higher-rate income tax threshold declining significantly in real terms since 2021, more landlords have been drawn into the 40% tax band, increasing the relative appeal of corporate ownership.
LIMITED COMPANY BUY-TO-LET
Today, an estimated 75% to 80% of all new buy-to-let purchases are made via limited companies, although some of the rise in incorporations also reflects landlords transferring existing properties into corporate structures.
The shift comes as rental growth shows signs of cooling. Across Great Britain, the average rent on newly let homes fell 0.2% year-on-year in January to £1,366 per month, marking the seventh consecutive monthly slowdown.
Inner London rents have now declined for 13 straight months, while growth across much of southern England has moderated sharply.
NO SIGNS OF ABATING
Aneisha Beveridge (main picture, inset), head of research at Hamptons, said: “Landlord’s shift towards limited company ownership continued through 2025 and shows little sign of slowing this year.
“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% income tax bracket, paying corporation tax at 19% or even 25% has become increasingly attractive.”
FINANCIAL SENSE
And she added: “Today, limited company ownership makes financial sense for the majority of landlords, with around 75%-80% 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.
“While newly agreed rents continue to record small annual falls, the pace of decline has stabilised. And as has been the case for the last two years, tenants renewing their contracts are seeing the larger rises.
“With rent increases due to be open to tribunal challenge from May, many landlords are using the months ahead to ensure their rents are aligned as closely as possible to market levels.”
