A record 66,587 new buy-to-let companies were formed in 2025, rising 8 percent from the previous high in 2024, according to the latest Hamptons Lettings Index. The figures highlight how punitive tax treatment continues to push landlords away from personal ownership and into corporate structures.
Five-fold increase since 2016
By the end of 2025, there were 443,272 active UK buy-to-let companies registered at Companies House – nearly five times the 91,278 recorded in 2016 when Section 24 mortgage interest relief restrictions were first introduced. Buy-to-let firms were the second most common type of company formed in the UK last year, behind only mail order services.
The pace shows no sign of slowing. New company registrations in early 2026 are running 11 percent above the same period last year, suggesting the trend will continue through the current tax year. For landlords weighing whether to transfer properties into a limited company, the tax arithmetic has become increasingly clear.
Frozen allowances fuel the shift
Aneisha Beveridge, head of research at Hamptons, said 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,” she said.
Beveridge noted that as more landlords find themselves pulled into the 40 percent income tax bracket, paying corporation tax at 19 percent or even 25 percent has become increasingly attractive. Around 75-80 percent of all new buy-to-let purchases are now made via a company.
Not a one-size-fits-all approach
Beveridge cautioned that limited company ownership is not suitable for every landlord. “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,” she said.
The data also showed that newly agreed rents recorded small annual falls in January, with the pace of decline stabilising. The average rent reached £1,366 per calendar month in Great Britain. However, tenants renewing their contracts continue to see larger rises as landlords seek to align existing rents with market levels ahead of the Renters’ Rights Act coming into force in May.
Editor’s view
The relentless rise in limited company formations tells its own story: personal ownership has become the expensive option for most landlords. With frozen allowances dragging more rental income into higher tax bands, the corporate route now makes financial sense for the majority. That nearly half a million buy-to-let companies are now registered shows this is no longer a niche strategy – it is the new normal.
Author: Editorial Team – UK landlord & buy-to-let news, policy, and finance
Published: 16 February 2026
Sources: Hamptons Lettings Index, Companies House
Related reading: Capital gains tax rule change will affect landlord incorporations
