Ring-Fencing Freehold Assets
Protect your commercial premises from trading liabilities, customer disputes or operational insolvency within the OpCo.
Acorn Corporate Desk · OpCo/PropCo Tax & Asset Protection Modeler
OpCo/PropCo Arm's-Length Rent & DLA Calculator
Optimise how your trading business (OpCo) pays rent to your property company (PropCo). Model HMRC-compliant market rent, Corporation Tax relief, freehold ring-fencing and a Director's Loan Account.
Model Your OpCo/PropCo Structure BelowDual-company strategy
The 4 advantages of an OpCo/PropCo structure
100% Tax-Deductible Operating Rent
Qualifying rent paid by OpCo to PropCo is ordinarily a deductible trading expense, subject to commerciality and professional advice.
Director's Loan Account (DLA) Creation
Injecting personal equity into PropCo may create a DLA balance, enabling repayments from future rental cash flow subject to correct accounting treatment.
Seamless Commercial Refinance
Lenders can underwrite PropCo debt against a long-term commercial lease supported by OpCo trading profits.
OpCo/PropCo Rent & DLA Calculator
A. OpCo Trading & Property Baseline
£400,000
£50,000£2,000,000
£1,200,000
£200,000£5,000,000
£650,000
£0£3,500,000
£250,000
£10,000£1,000,000
B. Arm's-Length Rent & Yield Settings
7.5%
5.0%10.0%
DSCR and cash-flow use an indicative 8.5% annual mortgage debt-service assumption. DLA treatment, available deductions and tax outcomes require accountant review.
Recommended HMRC Arm's-Length Annual Market Rent
£90,000
Annual OpCo Corporation Tax Reduction
£22,500
25% applied to rent up to the modelled trading profit; actual relief depends on deductibility and circumstances.
Initial Director's Loan Account Created
£800,000
Requested model: cash injected plus positive net equity. An accountant must confirm the legally credited DLA amount.
Annual Tax-Free DLA Cash Extraction Potential
£34,750
Indicative cash available after modelled debt service, before PropCo tax, costs and professional adjustments.
PropCo Debt Service Coverage Ratio
1.63x
HMRC Market Rent Compliance
To support HMRC compliance, rent charged from OpCo to PropCo should reflect documented open-market RICS evidence at approximately 7.5%. Artificially high rent may be challenged and can create tax consequences.
Commercial Mortgage Feasibility
The proposed arm's-length rent of £90,000 provides 1.63x indicative DSCR. This may support consideration of commercial refinancing up to 75% LTV, subject to underwriting.
Download Your OpCo/PropCo Structuring & Tax Audit (PDF)
Convert your calculations into a six-page Structuring Report covering lease covenants, indicative Corporation Tax savings and lender refinancing options.
Send these figures straight to a specialist broker — no need to re-enter your numbers.
Apply with These FiguresCritical Tax & Legal Notice
Acorn Finance is a specialist credit broker authorised and regulated by the FCA (#660207), not a tax advisory firm, chartered accountant, or legal practice. OpCo/PropCo corporate arrangements, arm's-length rent determinations, Stamp Duty Land Tax (SDLT), and Director's Loan Account (DLA) treatments carry strict HMRC compliance requirements. Always consult a qualified chartered accountant and tax specialist before altering lease structures or corporate ownership.