Which Financial Advice Is Right?

[2gbmum]

I've some inheritance which I'd like to invest in a London flat. My husband and I both work in London and commute every day. We would keep our home and use the flat as a weekday stopover.

My husband and I are a limited company - just us two shareholders. I suggested to our accountant that we buy the property through the company as we need it for work.

He strongly advised against this quoting envelope tax.

Another financial advisor has suggested it would be tax and stamp duty-effective and also suggested adding our (only) son as a shareholder so he can benefit profit-wise in the future.

Two opposing views but which one is right?

Can anybody help with more advice?

[fiction-factory]

There is a risk you'll get a third and fourth view by posting here but hopefully one of the experts on tax matters will be able to help. One thing that strikes me though is that it is your money not your company's money you would be using, so are you sure it's possible to make it look like a company purchase? I am not sure how the financing arrangements work

[2gbmum]

No, you're right *fiction-factory* I'm not sure how financing arrangements work either but it worries me that advisors can have such opposing views.

[fiction-factory]

Business rates might be a factor too if it's registered as the company's property and is used for business.

[Retrochic]

If you buy the flat through your Company it becomes an Asset and therefore can be liquidated as part of Company debt should you get into financial difficulties. If you own the flat personally, lots of costs (including mortgage interest payments and all utilities) can be deducted in part or full as allowable deductions with regard to Income Tax. I think its a case of swings and roundabouts but I would always take the advice of an Account over a Financial Advisor.

[2gbmum]

Thank you Retrochic. My accountant is the more cautious of the two. I guess this would be the safer advice to take.