Legal Entity for Shared Freehold

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2 Posts
1 month ago

Do three residential flat owners, who together share the freehold equally, have to have a limited company with associated HMRC returns etc, or can there be some other form of agreement?  

I purchased a first floor flat in 2018, being one of three flats on three floors, above a large shop on the ground floor.  The three flats all own an equal share of the freehold for these flats, however due to there being a commercial property below there is another "freehold" for the building as a whole which is owned by a large owner in the South West, with whom I communicate well.  When I purchased the flat, I took on the 1/3 share of the freehold of the flats from the previous owner.  This freehold was run by the owner of the second floor flat and took the form of a limited comapny, necessitating the appropriate bank account and annual return by a local accountant to HMRC.  When this owner sold his flat some 12 months ago, I took on running the "company", dealing with repairs, liaising with the main commercial freeholder etc.  However the new owner of the second floor flat does not wish to have a limited company type formation and does not wish to pay towards a chartered accountant to "do the books" annually.  Please could someone who has experience of this matter let me know if the owners of the flats need to have this limited company or can it take some other form, as she is insisting so that she doesn't have to pay towards accountancy fees etc?  Any advice greatly appreciated.  Thank you

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