To LTC or not to LTC

Our Experts Answer:

Probably the first thing to understand is that no extra deductions are available to you simply because you use the LTC. The same deductions would exist if you operate as an individual. An LTC may even be a disadvantage as it contains a loss limitation rule and administration costs are higher.

An LTC is a company under company law so the owner does enjoy the benefit of limited liability. But the risks with investment are low which reduces the need for this form of protection. Because the LTC is a separate entity from yourself it might be easier to refinance equity you build in the company by refinancing your shareholder advances. But this will only be a factor if you choose to inject funds to reduce the debt.

It might well be that personal ownership is entirely suitable.