Buying or selling a property is a significant financial commitment. But for self-employed professionals and business owners, the process comes with additional challenges. 

From securing a mortgage without a traditional salary to managing tax implications when selling property, careful planning is essential. In this guide, we break down everything you need to know to move house smoothly when you’re your own boss.

The Challenge of Getting a Mortgage When You’re Self-Employed

Unlike salaried employees, self-employed individuals must prove their income stability over time. Lenders want reassurance that you can afford mortgage repayments, which means demonstrating a strong financial track record.

Key Factors Mortgage Lenders Consider for Self-Employed Applicants

• Proof of income – Most lenders require at least two to three years of tax returns or certified accounts to assess your earnings. If your income fluctuates, they may take an average over this period.
• Business stability – Lenders prefer applicants who have been self-employed for several years, as it signals financial reliability. If you’re newly self-employed, you may face additional hurdles.
• Debt-to-income ratio – Keeping outstanding debts low improves your mortgage prospects. Avoid taking out new loans before applying.
• Retained profits – If you operate through a limited company, some lenders may only consider salary and dividends, not retained profits. A professional accountant can help structure your finances accordingly.

Steps to Improve Your Mortgage Approval Chances

1. Keep Your Accounts in Order

Lenders will scrutinize your tax returns, so ensure your finances are well-organized. If you haven’t already, hire an accountant to prepare up-to-date accounts that clearly show your income.

2. Optimise Your Income Reporting

Many self-employed people minimize taxable income through business deductions. However, this can backfire when applying for a mortgage, as lower reported income reduces borrowing power. 

3. Save for a Larger Deposit

A higher deposit reduces risk for lenders and improves your chances of approval. Many self-employed buyers find that putting down at least 15-20% strengthens their application.

4. Work with a Specialist Mortgage Broker

Some lenders are more self-employment-friendly than others. A broker who specializes in self-employed mortgages can match you with lenders who understand business owner finances.

5. Reduce Personal and Business Debts

Before applying for a mortgage, pay down as much debt as possible to improve your affordability assessment. Mortgage lenders look at your debt-to-income ratio, so keeping liabilities low can help.

6. Maintain Consistent Income Patterns

Lenders prefer stable and predictable income streams. If your income fluctuates, it’s crucial to demonstrate an upward trend over the years. Keeping income stable in the months leading up to a mortgage application can also help.

7. Build a Strong Credit History

A good credit score is essential for mortgage approval. Pay bills on time, avoid large credit card balances, and monitor your credit report for errors. If necessary, work with an accountant or financial advisor to improve your creditworthiness.

8. Choose the Right Type of Mortgage

Self-employed applicants may find that traditional mortgage options aren’t the best fit. Consider specialist mortgage products designed for self-employed individuals, which may offer more flexible lending criteria. Some lenders also offer offset mortgages, allowing you to use business savings to reduce interest costs.

Selling Property as a Business Owner: Capital Gains Tax Considerations

If you’re selling a property while self-employed, you’ll need to plan for Capital Gains Tax (CGT). The CGT rates for 2025-2026 are:

• 0% on gains up to £3,000
• 18% for gains between £3,001 and £50,270
• 24% for gains above £50,271

How to Reduce Capital Gains Tax on a Property Sale

1. Make Use of Your CGT Allowance

The annual CGT exemption of £3,000 cannot be carried forward, so use it before the tax year ends on 5 April 2025. If you have flexibility, timing your sale strategically can save money.

2. Consider Selling in Stages

If selling multiple properties, spreading sales across different tax years allows you to use multiple CGT allowances, minimizing your tax bill.

3. Understand Private Residence Relief

If the property you’re selling was your main home for the entire period of ownership, you may qualify for Private Residence Relief, which can significantly reduce CGT liability. However, if the property was used for business purposes, relief may be limited.

4. Furnished Holiday Lets (FHLs): Sell Before April 2025?

From 6 April 2025, the tax benefits for Furnished Holiday Lets (FHLs) will be abolished, meaning:

• Loss of tax deductions for mortgage interest and capital expenditure
• Rental profits will no longer count as 'earnings' for pension contribution tax relief
• Business Asset Disposal Relief (BADR) will no longer be available
  If you own an FHL and are considering selling, doing so before April 2025 could mean lower tax costs.

Why Work with Curve Accountancy?

At Curve Accountancy, we specialize in helping self-employed professionals and business owners navigate complex financial decisions. Whether you’re applying for a mortgage or selling property, our experienced accountants in Crawley can help.
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If you're a business owner in Crawley looking for financial guidance on property transactions, get in touch with us here at Curve Accountancy. We’ll help you navigate mortgages, tax planning, and property sales with confidence.

Give us a call to book in a chat.