When buying a second or third flat to let, many clients ask the same question: should I buy it in my own name, through my existing company — or set up a new EOOD (single-member limited company)? The answer depends on three things: how you will take the money out, how long you will hold the property, and whether you will buy with a loan.
Below we compare the two routes for a residential property let to households. If you are looking for premises for your own business, the logic is different — we covered it in our guide An office or shop for your own business. Figures are verified as of October 2026. This is not tax advice — make the final decision together with your accountant.
The rent. A 10% flat cost deduction comes off the gross rent (Art. 31 of the Personal Income Tax Act, ZDDFL), and 10% tax applies to the rest. In effect that is 9% of the rent. Actual costs — loan interest, repairs, furnishing — are not deductible, but nothing has to be documented either. Advance payments and returns are covered in our guide to tax on rental income.
The sale. This is the individual's biggest advantage. Under Art. 13(1)(1) ZDDFL, income is tax-free on the sale of one residential property held for more than 3 years (one property per calendar year), or of up to two properties held for more than 5 years. Outside those cases, 10% is due on the gain less a 10% flat deduction — effectively 9%. More in our guide to tax when selling.
The loan. You borrow as a consumer — with the protections of the Consumer Real Estate Credit Act and, typically, a lower down payment than on a business loan.
The rent. The company deducts its actual costs: interest, repairs, insurance, management, accounting, local taxes — plus tax depreciation of the building at up to 4% a year (category I under Art. 55 of the Corporate Income Tax Act, ZKPO). Land is not depreciated, so the price has to be split between building and land when the asset is booked. Profit is taxed at 10% corporate tax. A loss can be carried forward and offset against profits over the following five years.
Getting the money out. The profit stays in the company. To reach you it is paid out as a dividend, taxed at 5% (the 2026 rate; the proposal in the draft 2026 budget to raise it to 10% was not adopted), or as pay — with social contributions. Money you put in as a loan to your own company can be repaid to you tax-free, because repayment of principal is not income.
If you live in it. Use of a company property by you or your family is personal use of a company asset and is not tax-neutral. Under the proposals for 2027, the rate at which such benefits are taxed for managers and partners rises from 3% to 7%.
Administration. Bookkeeping, annual financial statements and an annual corporate tax return by 30 June. These costs recur every year, whether or not the property is let.
VAT on the purchase. Letting a home to an individual who is not a trader is an exempt supply (Art. 45(4) of the VAT Act). A company that buys a new home with VAT and lets it to households therefore, as a rule, cannot recover the VAT. It is a real cost, just as it is for an individual.
The sale. The 3- and 5-year exemptions apply only to individuals. A company pays 10% corporate tax on the difference between the sale price and the property's tax book value — which falls with every year of depreciation — and another 5% when it distributes the profit. If the company is VAT-registered and the building is new (within 5 years of being put into use), the sale carries 20% VAT. The proposals for 2027 also introduce mandatory VAT registration for taxable supplies of land and buildings — covered in our news piece on the Finance Ministry's draft.
An illustration on simplified assumptions — not an offer, and no substitute for your accountant's numbers:
| Individual | Company | |
|---|---|---|
| Rent | €9,600 | €9,600 |
| Allowable costs | €960 (10% flat) | €1,500 (actual) + €5,400 depreciation (4% × €135,000) |
| Taxable base | €8,640 | €2,700 |
| Tax | €864 | €270 corporate + €122 on the dividend |
| Cash to the owner after tax and costs | ≈ €8,136 | ≈ €7,708 |
On paper the company pays less tax — about €392 against €864. But the bookkeeping eats the difference, and the individual ends up around €430 better off. The calculation assumes you take all the cash out of the company: the profit as a dividend, the rest as repayment of the loan you used to fund the purchase.
With a mortgage. If you pay, say, €4,000 of interest a year, the individual's tax stays at €864, because interest is not deductible. In the company the interest is deductible, the profit turns negative and there is no corporate tax. The two routes come out practically level — around €4,100 a year either way.
On a sale after 6 years at €200,000. An individual who qualifies for the exemption owes no tax. In the company, the tax book value has fallen to about €127,600 (€160,000 less six years of depreciation), the gain is about €72,400, corporate tax about €7,240, and tax on distributing the remainder as a dividend another €3,260 or so. Around €10,500 in total, before any VAT.
Some choices are hard to undo. Moving a property from an individual to a company, or back, is a new transaction with local transfer tax, notary fees and possibly tax on the gain. That is why the structure is chosen before the purchase, not after it. Look at the net yield of the specific property too — tax is only one of the variables.
For one or two flats to let, owning in your own name almost always comes out ahead: the 9% effective rate is low, there are no accounts to keep, and a sale after 3 or 5 years is usually tax-free. A company wins when it already exists, when it reinvests the rent, or when the tenants are businesses. But on a sale it always pays tax.
If you are considering a buy-to-let purchase and are not sure whose name it should be in, call us or come into the office. We will run the numbers with your figures — price, rent, loan and time horizon — and go through them with your accountant before you sign.
Verified as of October 2026: ZDDFL (Arts. 13, 31, 33), ZKPO (Art. 55, 10% corporate tax), VAT Act (Art. 45(4)), the 5% dividend tax for 2026 and the published proposals for tax changes from 2027. The example uses simplified assumptions. This article is not tax advice.
