Incorporation is becoming an increasingly important strategy for landlords adapting to a changing tax and regulatory landscape, Pegasus Insight reveals.
Data from the Landlord Trends Report Q3 2025 shows that 22% of landlords own at least one rental property within a limited company.
One in three portfolio landlords now use a mixed status model, and for those with a limited company structure, around 70% of their portfolio is within the company.
The average number of properties in a limited liability company structure has grown over the past five years, from 6.3 in the first quarter of 2020 to 10.5 in the third quarter of 2025.
Meanwhile, the average total mixed status portfolio size has remained broadly stable at around 15 properties over the same period.
The research shows that this growth is mainly driven by new acquisitions, with landlords choosing to purchase recently added properties through a company rather than transferring older shares.
This structural shift reflects the increasing pressures landlords face, Pegasus says, as tax policy, operating costs and legislation evolve.
Pegasus Insight founder and director Mark Long says: “Landlords are operating in a very different environment than they were ten years ago.”
“As tax regulations become increasingly strict and compliance requirements increase, many see incorporation as the most robust way to run a rental business in the long term.”
“But incorporation is not an easy win. It comes with costs, additional administrative responsibilities and, crucially, should be carefully considered with a qualified tax advisor.”
“Mortgage brokers cannot and should not provide tax advice, and landlords need specialist guidance before making structural changes to their business.”
“The Chancellor’s decision in the recent Budget to introduce new higher ‘property’ tax bands of 22%, 42% and 47% for landlords holding properties in their own names from April 2027 is only likely to accelerate the move towards corporate structures.”
“But it also risks punishing the very people who have been the backbone of the PRS for some thirty years: smaller, long-standing landlords who have quietly delivered good quality housing without the resources or scale to absorb repeated policy shocks.”