Moving losses

Moving losses

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My client is a limited company that has retained losses, and is now operating profitably. They are keen to stop paying a salary and the high PAYE and NI costs and change to dividend payments.

They have come up with an idea to have another unconnected company to invoice and pay them the an amount that will wipe out their retained losses so that they can legally pay dividends going forward.

The costs of this route is that they will lose 19% of their retained loss in corporation tax that they will not be able to offset against this loss, are there any other down sides against this transaction I should be aware of

Many thanks

Sarah Kedgely

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By User deleted
10th May 2005 20:09

Lots of issues ...

But if you find another company that will pay £100,000 for goods or services that will not be provided then ask them if I can send them an invoice as well ....

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