For investors
Investing in Scottish property
Rent pays an income, the price moves underneath it, and a loan multiplies both. This page is the whole of it: what the return is made of, whether a limited company should hold it and who that wrapper fits, every cost of a £500,000 Edinburgh purchase from incorporation to the first year’s corporation tax, one flat against a portfolio against a licensed HMO, where yield and growth sit between the capital and the county, and the lender panel your solicitor needs to be on.
Arithmetic on published rates, not tax or investment advice. The right structure depends on your income, your other properties and your plans, and an accountant should run your own numbers before anything is signed.
Income
4.8% to 6.6%
Typical gross yields, Edinburgh to Midlothian. Gross: the case study below is what reaching net looks like.
Growth
+22% to +45%
Five-year moves in the four areas’ median sale prices, 2018 to 2023. The register records what happened, not what is next.
Gearing
Both ways
A loan multiplies the return on your cash, and the loss. The interest is the price of that exposure.
Company or your own name
What the wrapper changes, and what it does not
The property, the tenants and the letting law are identical either way. What changes is the tax at every stage, the lending, and whose money the profit is. Six facts carry the whole decision.
Mortgage interest
Deducted in full
Held personally, finance costs on a residential let no longer reduce your rental profit: relief arrives afterwards as a basic-rate credit worth 20% of the interest. A company deducts the interest in full as a cost of the business before tax is worked out. On a large loan this one line is usually the reason the company exists.
Tax on the profit
19%
Rental profit held personally stacks on top of your other income and is taxed at your marginal rate of Scottish income tax, which runs as high as 48%. A company pays corporation tax instead: 19% where profits are £50,000 or less, 25% above £250,000, with marginal relief between. A single let held this way sits in the 19% band.
Taking money out
Taxed again
The company’s profit is the company’s money. Pay it to yourself and it is taxed a second time: dividends above the £500 allowance are charged at 10.75%, 35.75% or 39.35% depending on your band. The structure rewards profit left inside to fund the next purchase, and is at its weakest when every pound is drawn out as it arrives.
The tax on buying
£63,350
LBTT is charged on the same bands whoever the buyer is, and the 8% Additional Dwelling Supplement is charged on the whole price. A company pays ADS on its very first purchase: the main-residence questions that can spare an individual never apply to it. On a £500,000 purchase the two together come to £63,350, in cash, on the day.
The borrowing
125% cover
Company buy-to-let is a specialist market. Expect personal guarantees from the directors, rates and fees a step above a personal buy-to-let, and the rent tested against the loan: lenders typically want it to cover 125% of the interest at a stress rate. The same test for a higher-rate individual is commonly set at up to 145%, which is why a company can often borrow more against the same rent.
Selling up
Tax on the gain
A company pays corporation tax on the gain when it sells, with no annual exempt amount. Held personally, a residential gain above the £3,000 exempt amount is charged at 18% within the basic band and 24% above it. A company also opens a second door: the shares can change hands instead of the property. What that is worth depends entirely on the buyer, and it is a question for an accountant before it is a plan.
Two more facts belong in the picture. A dwelling worth more than £500,000 held by a company falls within the Annual Tax on Enveloped Dwellings; a property let commercially at arm’s length qualifies for full relief, but the relief has to be claimed on an ATED return each year, so the duty to file survives even while the charge is nil. And the company is a separate legal person: its money is not your money until it pays you, its accounts are public at Companies House, and it costs £100 to incorporate and £50 a year in filing fees before an accountant is paid.
The case for the company
- The mortgage interest is deducted in full
- Profit kept inside is taxed once, at 19%
- Retained rent compounds into the next deposit without passing through your income first
- More loan against the same rent, at 125% cover instead of up to 145%
- Shares can pass, or be sold, without conveying the property
- The debts are the company's, though personal guarantees reach past that
The case against it
- ADS at 8% of the whole price, from the very first purchase
- Profit is taxed twice on its way to your pocket
- Dearer, narrower lending, with personal guarantees expected
- Accounts filed at Companies House, in public, and paid for every year
- No capital gains exempt amount, and never main-residence relief
- A property you already own cannot simply move in: the transfer is a market-value sale, with your CGT and the company's LBTT and ADS both due on it
Who the wrapper fits
Not a personality question: the same arithmetic lands differently on different situations. Three cover most people who ask us.
Fits well
A higher-rate or top-rate earner, letting for the long term, leaving the rent inside the company to build towards the next deposit. Every advantage on this page points their way, and the second layer of tax barely touches money that is never drawn out.
Run it both ways
A basic-rate taxpayer with one property who spends the rent. At 20%, the personal interest credit restores most of what a company would deduct, and profit drawn straight out as dividends can carry more total tax than the same profit taxed once personally. The company earns its keep here only if the plan is to grow past one.
Does not fit
Anyone who might live in the property one day, because a company never gets main-residence relief. A short holding, because the buying taxes land on the way in and the gain is taxed on the way out, and a modest rise can be eaten by both. And a property already owned personally, which can only get in by being sold to the company at market value.
Corporation tax, dividend tax, Scottish income tax and capital gains figures: GOV.UK, 2026-27 rates, checked 19 August 2026. LBTT and ADS: Revenue Scotland, checked 9 August 2026. Companies House fees checked 19 August 2026.
The case study
£500,000 in Edinburgh, all the way through
One purchase at £500,000, bought by a company set up for the job, with a 65% mortgage, let at £1,975 a month: our indicative rent for a three-bedroom Edinburgh let. Figures that are assumptions are named as assumptions and gathered at the foot; figures that are ours are the published rates.
First
The company
The vehicle is a special purpose vehicle: a company that exists to hold property and nothing else, incorporated at Companies House for £100 under the SIC codes lenders look for (68100 or 68209, buying and letting own property). It needs its own bank account, with the deposit and the tax money in it before an offer goes in, because a Scottish purchase binds at conclusion of missives, weeks before the date of entry.
The lender will want personal guarantees from the directors, and your solicitor handles the lender’s security alongside the purchase itself. That only works if the firm sits on your lender’s conveyancing panel, which is what the directory at the foot of this page is for.
Settlement
The money on the table
Cash the purchase needs on the day, before a tenant exists.
£63,350 of that is tax: 12.7% of the price, paid before the keys. The banded working is on the LBTT calculator. The lender’s 3% arrangement fee, £9,750 here, is added to the loan rather than paid on the day, so it surfaces in the interest line below instead. Solicitor, valuation and broker figures are assumptions.
The loan
What the rent will borrow
£1,975 a month is £23,700 a year. At 125% cover tested at 5.5%, that rent supports a loan of about £344,000, whatever the property costs. The cover test, not the deposit, is usually what caps borrowing against Edinburgh yields. The example borrows £325,000, which is 65% of the price and leaves the test passed with room for rates to move.
Interest-only at an assumed 4.99% on £334,750, the loan plus its fee, costs £16,704 a year. The rate is an assumption to make the arithmetic concrete, not a quote: your broker’s figure replaces it on the day.
Year one
The first year, both ways
The same building and the same tenant, with and without the debt.
| Year one | With the 65% loan | Bought outright |
|---|---|---|
| Rent collected | £23,700 | £23,700 |
| Management at 12% of rent collected | £2,844 | £2,844 |
| EICR, gas and legionella, at cost plus £30 each to arrange | £445 | £445 |
| Landlord insurance | £350 | £350 |
| Accounts, tax return and confirmation statement | £850 | £850 |
| Mortgage interest | £16,704 | £0 |
| Profit before corporation tax | £2,507 | £19,211 |
| Corporation tax at 19% | £476 | £3,650 |
| Left in the company | £2,031 | £15,561 |
| Cash the purchase took | £241,345 | £565,250 |
At 65% gearing the first year roughly washes its face: the building is bought, the compliance is done, and the company keeps £2,031. Bought outright, the same year keeps £15,561, which is 2.8% of the £565,250 deployed, after every cost on this page including the corporation tax.
The other half of the return is the price. The register puts Edinburgh’s median sale at £221,000 in 2018 and £268,961 in 2023, a rise of 22% over five years. The register records what happened; it promises nothing about the next five. Debt multiplies your exposure to that move in either direction, which is the real meaning of the two columns above.
Every assumed figure, in one place
- Mortgage: 4.99% five-year fix, interest only, 3% fee added to the loan, cover tested at 125% of interest at 5.5%
- Solicitor £1,800, lender’s valuation £600, broker £495
- Landlord insurance £350 for the year
- Accountant and Companies House filing £850 for the year
- First compliance £445: certificates are charged at the contractor’s own cost plus £30 each to arrange, so the certificate prices inside the figure are the assumption
- A full year of rent at £1,975 a month, with no empty weeks: an assumption that flatters any first year with a purchase in it
Ours, and published: management at 12% of rent collected, VAT included, and the £30 per certificate arrangement fee. The whole schedule is at landlord fees. The rent is our indicative figure for a three-bedroom Edinburgh let, not a valuation of any particular home. Broker, solicitor and insurer quotes replace their rows on the day.
One flat, three flats, or rooms
Three shapes the same money takes
The case study bought one property. The same capital has three natural shapes, and they behave differently: in yield, in what a void costs, in tax on the way in, and in how much management they buy.
One property
4.7% gross
The case study above: one £500,000 Edinburgh let at £1,975 a month. One tenancy to run, one set of certificates, the buying tax paid once, and the deepest resale market in Scotland underneath it.
Its weakness is concentration. An empty month is all of the rent gone, not part of it, and one address carries the whole of the growth story.
A portfolio of three
6.9% gross
Three houses at £182,000 — the register’s lower quartile for Midlothian, which is the ex-colliery terraced end of the county around Dalkeith, Mayfield and Gorebridge — each letting at £1,050 a month on our indicative Midlothian figure. £546,000 of purchases earning £37,800 a year. A void costs a third of the rent rather than all of it, and three addresses spread the risk that one street disappoints.
The price of the spread: the buying costs are paid three times over. At £182,000 only £740 of the tax is LBTT — the nil band ends at £145,000 — so almost the whole of the £15,300 on each purchase is ADS, £45,900 in all, beside three sets of legal fees, certificates and tenancies. This end of the register also carries the most hands-on management in the county, which is a cost in attention where the case study’s single let is a cost in concentration.
A licensed HMO
Let by the room
3 or more unrelated people sharing a kitchen or bathroom make a house in multiple occupation, and an HMO needs a licence from the council before they move in. The council must be satisfied the owner and any manager are fit and proper and the property suitable, and it sets both the physical standards and the fee. Letting without a licence risks a fine of up to £50,000.
What the licence buys is room-by-room income: rooms let separately gross more than the same flat let whole, which is why the student streets around the universities run this way. What it costs is intensity: more turnover, more wear, shared areas to keep, and lending from the specialist end of the market. What a licensed four-bedroom near the Meadows achieves is a valuation question, not a table lookup: ask us for the number before you offer, not after.
Short-term letting is none of the above: it runs under a separate licensing scheme with its own planning rules and different economics, and this page does not price it. HMO licensing: mygov.scot and gov.scot, checked 19 August 2026. Portfolio figures use our indicative rents and round purchase prices beside the register medians in the table below.
Where we work
The city has the depth. The county has the yield.
Edinburgh carries the deepest tenant demand and resale market in Scotland at the tighter yield. Midlothian, across the bypass, carries the stronger gross yields — and on the register's last five years the stronger price move too. The table holds both side by side, and the belt beneath it shows all three Lothian councils on the same register.
| Area | Median price 2023 | Five years | Two-bed rent | Typical gross yield |
|---|---|---|---|---|
| West Lothian | £210,000 | up 45% | £835 pcm | 6.6% |
| Midlothian | £261,000 | up 42% | £1,050 pcm | 5.9% |
| East Lothian | £283,998 | up 42% | £1,325 pcm | 5.6% |
| EdinburghThe focus | £268,961 | up 22% | £1,495 pcm | 4.8% |
Median prices and the five-year change: Registers of Scotland, via statistics.gov.scot, 2023 against 2018, published under the Open Government Licence v3.0, fetched 5 September 2026. Rents and yields: our indicative figures for a typical two-bedroom let, gross, before every cost the case study just itemised. The price and rent columns come from different sources and are deliberately not divided into each other.
The register’s outliers
The belt around Edinburgh
The strongest five-year moves on the whole register sit in the three councils around the capital, where the trains put Livingston, Dalkeith and Musselburgh inside an Edinburgh working day at well under Edinburgh’s prices.
Same source and dates as the table above. The register records sales, not rents: letting demand in the belt still keys off the Edinburgh economy.
The focus
Why the lowest yield in the table is the focus
Edinburgh carries the lowest gross yield of the four areas and the strongest everything else: the deepest tenant demand in Scotland, from two large universities, the festivals, government and a financial services workforce, and 10,052 registered sales in 2023, so buying and selling stay liquid. A half-million budget is not a constraint here. Against a city median of £268,961 it buys the stock that lets fastest, or two smaller lets rather than one.
One bed
£1,075
a month, indicative
Two bed
£1,495
a month, indicative
Three bed
£1,975
a month, indicative
New Town
Georgian terraces between Princes Street and Canonmills. Listed-building constraints make upgrades slower and more expensive, but the rents are the highest in Scotland.
Who rents here: Senior professionals, diplomatic and corporate lets, relocating executives.
Leith
From the Shore up to Leith Walk, plus the newer waterfront blocks. The tram extension changed commuting patterns here and rents moved with it.
Who rents here: Young professionals, creative industries, and couples buying time before purchasing.
Marchmont
Large Victorian tenement flats south of the Meadows. Traditionally the student heartland, and still the first place postgraduate groups look.
Who rents here: Students, postgraduates and university staff.
Bruntsfield
Bruntsfield Place and the streets around it. Well-proportioned flats, good independent shops, and a short walk to the Meadows. Consistently one of the fastest-letting areas in the city.
Who rents here: Professional couples, young families, and academics.
Stockbridge
Colony houses, riverside walks and the Sunday market. Limited stock and strong tenant retention mean vacancies here are short.
Who rents here: Professionals and families who tend to renew rather than move.
Old Town
The Royal Mile, Grassmarket and Cowgate. Characterful, often listed, and heavily affected by short-term let planning rules.
Who rents here: Students, city-centre workers, and shorter professional tenancies.
Morningside
Comfortable south-side suburb with strong schools and generous flats. Tenants here sign long and stay.
Who rents here: Families, senior professionals and academics.
Portobello
Edinburgh's beach. A distinct community feel, good bus links into town, and rising demand from renters who want space without leaving the city.
Who rents here: Families, remote workers and downsizers.
Newington
The Southside proper, from the Pleasance out along Dalkeith Road and Minto Street. Divided townhouses and tenement flats sitting on the main bus corridor to the Royal Infirmary, which is what shapes demand here rather than anything on the tourist map.
Who rents here: Medical and nursing staff, postgraduates, and NHS Lothian rotational appointments on six to twelve month lets.
Craigmillar and Little France
The Royal Infirmary of Edinburgh, the Edinburgh BioQuarter, and the new-build blocks that have gone up around them. A working district rather than a picturesque one, and the most reliable source of professional tenants on the south-east side of the city.
Who rents here: NHS Lothian staff, BioQuarter researchers and clinical fellows, and relocating professionals who want to walk to work.
Liberton and Gilmerton
Interwar and postwar family housing on the southern edge of the city, where Edinburgh runs into Midlothian. Semis and terraces with gardens and off-street parking, at rents that undercut anything comparable further north.
Who rents here: Families, hospital staff priced out of Newington, and tenants who need a car and somewhere to put it.
The neighbourhood pages carry what each patch lets for and who it lets to, and the Edinburgh landlord page carries the rest of the city. Before an offer goes in on any of it, the rental valuation gives you the likely rent and the comparable lets behind it, free, which is the number every calculation on this page starts from.
Borrowing
Your solicitor and the lender’s panel
A lender completes through a solicitor it has approved: its conveyancing panel. In Scotland one firm ordinarily acts for you and for the lender in the same purchase, and it can only do both while it sits on that lender’s panel; instruct a firm that does not, and you pay for the lender’s own solicitor on top. So the working order is: decision in principle first, then a solicitor confirmed on that lender’s panel, then the offer.
The directory below is lenderpanel.com’s, all 163 names, reproduced as published on 19 August 2026 and grouped the way it groups them.
Big banks
18 names- Aldermore Bank
- Barclays
- Co-operative Bank
- Halifax
- HSBC Bank
- Lloyds Bank Private Banking
- Lloyds TSB Scotland
- Metro Bank
- NatWest
- RBS Direct Line Mortgages
- RBS First Active
- RBS NatWest One Account
- RBS One Account
- RBS Virgin One
- Royal Bank of Scotland
- Santander
- TSB
- Virgin Money
Building societies
49 names- Barnsley Building Society
- Bath Building Society
- Beverley Building Society
- Buckinghamshire Building Society
- Cambridge Building Society
- Chelsea Building Society
- Chesham Building Society
- Coventry Building Society
- Cumberland Building Society
- Darlington Building Society
- Dudley Building Society
- Earl Shilton Building Society
- Ecology Building Society
- Family Building Society
- Furness Building Society
- Hanley Economic Building Society
- Harpenden Building Society
- Hinckley and Rugby Building Society
- Holmesdale Building Society
- Ipswich Building Society
- Leeds Building Society
- Leek Building Society
- Loughborough Building Society
- Manchester Building Society
- Mansfield Building Society
- Market Harborough Building Society
- Marsden Building Society
- Melton Mowbray Building Society
- Monmouthshire Building Society
- National Counties Building Society
- Nationwide Building Society
- Newbury Building Society
- Newcastle Building Society
- Norwich and Peterborough Building Society
- Nottingham Building Society
- Penrith Building Society
- Principality Building Society
- Progressive Building Society
- Saffron Building Society
- Scottish Building Society
- Skipton Building Society
- Stafford Railway Building Society
- Suffolk Building Society
- Swansea Building Society
- Teachers Building Society
- The Chorley & District Building Society
- Tipton Coseley Building Society
- West Bromwich Building Society
- Yorkshire Building Society
Specialist lenders
94 names- Accord Mortgages Ltd
- Adam & Company
- Adam & Company International
- Agricultural Mortgage Corporation
- Ahli United Bank
- Allied Irish Bank (GB)
- April Mortgages
- ASTRA mortgages
- Atom Bank
- Aviva Equity Release UK Ltd
- Bank of Ireland
- Bank of Ireland Mortgages
- Bank of Scotland
- Bank of Scotland Private Banking
- Banks and Clients
- Better HomeOwnership (Mortgages)
- Birmingham Bank
- Birmingham Midshires
- Bluestone Mortgages
- Bradford & Bingley Limited
- Britannia
- Capital Home Loans
- Clydesdale Bank
- Coutts
- Cynergy Bank
- Danske Bank UK
- DB UK Bank Ltd
- First Direct
- First Trust Bank
- Fleet Mortgages
- Foundation Home Loans
- GE Money Home Lending Ltd
- Gen H
- Godiva Mortgages Ltd
- Habito
- Hampden & Co
- Handelsbanken
- Hodge Equity Release
- Hodge Life
- Intelligent Finance
- Investec Bank
- JPMorgan Chase Bank, N.A.
- Kensington Mortgage Company Ltd
- Kent Reliance
- Keystone Property Finance
- Landbay Partners Ltd
- Landmark Mortgages Limited
- LendInvest
- LiveMore Capital
- M&S Bank
- Magellan Homeloans
- Masthaven Bank
- MBS Lending Ltd
- ModaMortgages
- Mortgage Agency Services
- Mortgage Express
- MPowered Mortgages
- Nedbank Private Wealth Ltd
- New Life Mortgages Ltd
- New Street Mortgages
- Newbury Mortgage Services Ltd
- NRAM Ltd
- Paragon Mortgages Ltd
- Paratus AMC Ltd
- Parity Trust
- Pepper Homeloans
- Pepper Money
- Pepper Money (PUK)
- Perenna
- Platform Home Loans Ltd
- Precise Mortgages
- Reliance Bank Ltd
- Rely Mortgages
- Rooftop Mortgages Ltd
- Sainsburys Bank
- Scottish Widows Bank
- Secure Trust Bank
- St James Place Bank
- State Bank of India UK
- Tandem Bank
- Tesco Bank
- The Mortgage Business
- The Mortgage Lender
- The Mortgage Works
- Together Commercial Finance Limited
- Together Personal Finance Limited
- Topaz Finance
- Tresta Property Finance
- Ulster Bank
- Vida Homeloans
- West Bromwich Mortgage Company
- Whistletree
- Yorkshire Bank Home Loans Ltd
- Zephyr Mortgages
Buy-to-let
2 names- Accord Buy to Let
- Molo Finance Buy to Let Mortgages
The list is the directory’s record of whose conveyancing panels exist, not of who is lending today. It includes brands closed to new business, and only some of the names lend to limited companies at all: company buy-to-let sits mostly with the specialist end of the market. A whole-of-market broker confirms who is open, at what rate, on the day. We are a letting and estate agency, not a mortgage broker, and we do not arrange finance. The live directory is at lenderpanel.com.
Put the rent in writing before you offer.
Every figure on this page started from one number: what the property lets for. We will put that figure and the comparable lets behind it in writing, free, before you commit to anything. If you buy, management is 12% of rent collected, published, VAT included.