Hi all,
Can a company pay off another company's liabilities if they are experiencing cashflow problems?
Replies (3)
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Related parties
Yes but there may be various tax problems if there is some relationship between the owners and directors of the companies.
ALSO
If either of them went bust it would cause serious problems for the other. Not sure but I guess if it was the loanee the directors of the loanor could be held personally liable for the loss if it dragged them under.