Buying a rental property inside a limited company — a special purpose vehicle, or SPV — has become the default route for many UK landlords since the mortgage interest rules changed for individuals. The structure is simple: one company, one property, rental income in, mortgage and costs out. The accounting, happily, can be simple too, because most single-property SPVs qualify as micro entities and file under FRS 105.

Well-run SPVs treat micro entity accounts for property SPVs as an annual routine built on a year of clean records: rent received, mortgage statements, insurance, repairs and the letting agent's statements, all kept in one place.

Does a single-property SPV qualify as a micro entity?

Usually, yes. A company qualifies if it meets two of three thresholds: turnover of £1 million or less, a balance sheet total of £500,000 or less, and 10 or fewer employees. A single buy-to-let typically passes on turnover and employees — but watch the balance sheet test: the property sits on the balance sheet at cost, and a valuable property (or one bought with a small deposit and large mortgage, since the test uses gross assets) can push the balance sheet total over £500,000. Check eligibility every year; outgrowing micro status means filing small company accounts instead, which is a change of format, not a disaster.

What the accounts show — and what they don't

FRS 105 accounts are abbreviated: a balance sheet with minimal notes, and no profit and loss account on the public register. Rental income, mortgage interest and repairs still matter — they drive the Corporation Tax computation filed with HMRC on form CT600, where the full figures are declared. HMRC's overview of Corporation Tax covers rates, allowances and filing dates: the return is due 12 months after the period end, but the tax itself is payable nine months and one day after — a date pairing that catches out many first-time SPV directors.

SPV-specific points to get right

Keep the director's loan account clean: every pound you lend the company to fund the deposit, and every repayment, should be documented. Distinguish repairs (revenue costs, deductible) from improvements (capital, not deductible against rent). If the property sits empty between tenants, the company still files on time — an SPV with no rent in a period still has accounts and a confirmation statement due. And if you plan to build a portfolio, consider whether each property gets its own SPV or one company holds several; that structural choice is far easier at purchase than afterwards.

One property, one company, one tidy set of records — the SPV model works precisely because it stays simple. Keep it that way and the annual accounts nearly prepare themselves.

More Resources