Share this content

Non trading loan relationship

UK company has issued € share capital however the accounts are prepared in GBP. Is it right that the share capital value shown by the balance sheet is at the historic rate and the unpaid € amount (holding company debtor) is shown at the balance sheet rate with any fx differences being a non-trading loan relationship? 

Many thanks for confirmation.


Please login or register to join the discussion.

Is the shares equity or debt? Equity does not get revalued, but if it was debt it would be.

Thanks (0)

Hi, thanks for your response. The shares are equity, however they are not paid hence there is an outstanding loan balance for the full amount payable on the shares. Currently I have the share capital translated at historic rate and was under the impression that the loan balance should be translated at closing rate as it is a monetary debt? This gives me a difference in exchange arising as a result of movements in the loan balance. As its quite substantial, I just want to check the tax implications.

Thanks (0)

Can't help you on the tax implications, sorry. Has the unpaid amount been called up (ie is it really a debtor) though? Mistakes there are quite common and would possibly solve the problem.

Thanks (0)

Thanks Limey - yes share capital stated as paid in the annual return so it would appear that the unpaid amount should be treated as a loan. Thanks anyway.

Thanks (0)

Stated as paid? Gulp. That should probably get paid then.

Thanks (0)

Nice blog!

Thank you for imparting this to us! This is such a nice blog.

<a href=""></a>

<a href="">buy soundcloud plays</a>

Thanks (0)