A client is owed money from the sale of their business, the purchaser is paying monthly interest on the outstanding debt.
The question is are there any costs allowable against the interest received? for example solicitors costs for administration of the interest calcualtion and ensuring the monies are paid on time. very little capital has been repaid.
I think I am right in thinking that this interest does not fall part of capital gains tax and does not get added to the proceeds.
The interest received is quite substantial.
My thoughts are that no costs are allowed against interest received, costs can not be offset against the trade as the business was sold.
Any comments are greatly appreciated.
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Loan interest received
The interest received would not qualify for any relief as it is on a par with bank and building society interest and making loans is not, I assume, the vendors trade.