Have a client who has several companies, one of which they no longer trade through and want to strike off. However they have overdrawn directors loan accounts and not the cash to repay. What is the process to resolve this and complete the dissolution/strike off of the company.
Any help/advice appreciated thank you.
Replies (3)
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DLA
isnt the loan written off in the accounts and just treated as a distribution out of income on the director? I.e. taxed on him as a net dividend
ITIOA 2005 s.415
Write off loan
Basically you will have to write the loan off before gettign into the strike off procedures otherwise if the company is struck off it will have assets (namely overdrawn Loan Accounts) that will fall to the Crown and be recoverable by the Lord Chamberlains Department of the Treasury
regards and hope that this helps
Treat loan write off as earnings for NICs?
see the desision in Stewart Fraser - but you never know, these things are facts sensitive and that was only the First Tier Tribunal.
The other point is to consider the timing of any s455 tax refund due, depending on whether paid in the first place, and the requirement to file P11Ds etc to account for beneficial loan interest. A lot of housekeeping to complete first.
Virtual tax support for accountants: www.rossmartin.co.uk