Limited Company Transfer Valuation

Under the connected party rules in SDLT and CGT legislation, a transaction between a company and a connected person (director, shareholder, group company) is deemed to take place at market value — even if no consideration is paid, or the consideration paid is below market value. This prevents tax avoidance through artificial pricing. For example, if a director transfers a property worth GBP 300,000 to their company for a nominal GBP 1, SDLT is still payable on the market value of GBP 300,000. Similarly, the company's base cost for future CGT purposes is the market value at the date of transfer. Our valuation provides the independent market value figure that HMRC needs to verify the transaction.

An SPV (Special Purpose Vehicle) is a limited company established specifically to hold investment property. Many landlords incorporate their buy-to-let portfolios into an SPV for tax efficiency — particularly now that mortgage interest relief for individual landlords is restricted to the basic rate of income tax, whereas companies can still deduct all finance costs. Transferring property into an SPV is a disposal for CGT purposes and an acquisition for SDLT purposes — both taxes are calculated on the market value. Our valuation provides the market value evidence for both the CGT calculation on the transferor and the SDLT return on the company's acquisition.

Each property is a separate asset and HMRC expects each to be valued individually. If you are transferring a portfolio of (say) 10 buy-to-let properties into an SPV, you need a market value for each property — not a single aggregated figure. We inspect each property, research comparable sales for each, and produce individual valuation reports. We can also provide a consolidated schedule summarising all valuations for your accountant or for inclusion in the SDLT return. For portfolios, we offer discounted rates for multiple valuations.

The accounting treatment differs significantly. Under FRS 102, investment property (property held to earn rental income or for capital appreciation) is measured at fair value at each reporting date, with changes in fair value recognised in profit or loss. Trading stock (property held for sale in the ordinary course of business) is measured at the lower of cost and net realisable value. The classification affects how the company's accounts present the property and how profit is measured. Our report identifies the property's use and provides the valuation on the appropriate basis for the company's accounting treatment. Your accountant will advise on the correct classification.

Generally yes — provided the valuation date is the same. The SDLT valuation date is the date of the transfer. If the company's accounting reference date is close to the transfer date, the same market value figure will often be appropriate — but you should confirm this with your accountant. If the accounting date is significantly later than the transfer date, a separate (updated) valuation may be needed for the accounts to reflect the market value at the reporting date. We can advise on whether an updated valuation is necessary.

SDLT is payable by the transferee company on the market value of the property at the standard residential rates (plus the 3% additional dwelling surcharge if the company already owns other residential property). The SDLT rates are progressive — 0% on the first GBP 250,000, 5% on the next GBP 675,000, and so on (rates correct as at the date of this page — please check the current rates with your solicitor or tax adviser). If the property is one of multiple dwellings being transferred, Multiple Dwellings Relief may be available. Our valuation provides the market value; the SDLT calculation itself should be done by your solicitor or accountant.

The cost depends on the property type, value, location and the number of properties being valued. We provide a fixed-price quote within 24 hours of your enquiry — the price we quote is the price you pay, with no hidden extras and no VAT added to our fees. For portfolio valuations, we offer discounted rates for multiple properties. The cost of the valuation should be considered alongside the professional fees of your accountant and solicitor — and, importantly, against the potential cost of an HMRC challenge if the market value is not properly evidenced. We cover all seven counties: Bedfordshire, Buckinghamshire, Cambridgeshire, Hertfordshire, Northamptonshire, Greater London and Oxfordshire.

HMRC has the power to investigate SDLT returns and challenge valuations. If HMRC opens an enquiry, they will want to see evidence that the market value declared on the SDLT return is reasonable — and a formal RICS Red Book valuation from an RICS Registered Valuer is the best evidence you can have. Our reports are prepared to withstand HMRC scrutiny: they set out the valuer's qualifications, the basis of valuation, the comparable evidence relied upon, the methodology applied, and the reasoning that led to the opinion. If HMRC does challenge, we are available to discuss the valuation with them or provide a supplementary letter of explanation — though in practice, a properly prepared Red Book valuation rarely results in a successful challenge.