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Property in france held by uk company. CT600 reporting.
Posted by Anonymous on Tue, 09/02/2010 - 10:11
A french property has been purchased through a uk ltd company. The house is not habitable. All expenses to date are renovation costs including the equivalent of council tax. How do I report the loss on the CT600? As a trading loss or loss from overseas property?
When completed two of the directors will live in it as their main residence. If they buy the property from the company what CGT alowances if any will be available to the company?
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Whose bright idea was that then?
Just a few questions:
Why do you think the company is trading?
Is the company registered for French VAT? should it be?
Will you be completing the French tax returns?
Do you know the French rules on benefits in kind?
If the directors buy the house from the company at less than market value there will be UK taxable BiK of the shorfall.
How will this be affected by double tax relief on the French tax on the profit?
Will the French tax on the profit be on the price used or on the market value?
How much of their anticipated saving will be eaten up in professional fees?
When will they learn!
French property CT600
Fortunately not my bright idea. The original advice came from an estate agent and french solicitor who were biased towards sorting out french inheritance rather then english/french tax and accounting issues.
The reason I ask about trading income is because that is how it was incorectly reported last year. Is there any merit in advising the inland revenue of the error last year?
I note your comments about BIK and Vat. The house when completed would be purchased at market value. Only then will the director and wife move in. They appreciate that at this point there will be tax to pay.
As for the french tax returns that is something that I will be encouraging them to take specialist advice on.