Buy to let landlords caught in £50m tax avoidance scheme

HMRC is warning buy to let property owners not to use a tax avoidance scheme to reduce the tax payable on profits generated from rentals

The scheme is likely to have resulted in up to £50m of tax avoidance by breaking tax rules by using a hybrid partnership structure, and has attracted hundreds of landlords, looking to cut their tax bills.

Less Tax 4 Landlords Ltd runs the scheme, which sees landlords set up a limited company to hold the properties and then transfer their properties to a limited liability partnership (LLP) which allocates profits to members, thereby avoiding tax.

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