I act for two clients who are 50/50 shareholders in a limited company and also 50/50 partners in another, separate partnership. The two businesses operate out of the same premises and share overheads and joint expenses etc. on an agreed basis.
The clients in their capacity as directors of the company have overdrawn DLA balances which have properly been declared to HMRC. However, the company also has a debtor balance due from the partnership. There has historically been an inter-business balance between the company and the partnership caused by recharging of proportions of expenses and/or simply borrowing between the two business from time to time to fund cash flow requirements. Sometimes the balance has been credit, sometimes debit.
This has not been a problem in the past. However, in 2010/11 for some reason the inspector has raised a query, claiming that the inter-business balance falls within S.455 and should therefore have been declared on the supplementary pages on the CT600.
Now, any balance arising on this account has always been for business purposes. It has never represented anything used personally by the partners (that's what the DLA is for). It seems to me that the Inspector wants to treat the inter-business balance simply as an extension of the DLA, and I'm sure that S.455 ever intended this.
Does anybody out there have previous experience of this situation? Observations as ever gratefully received.
- Amend tax return? 92 2
- Self Assessment and P11D 184 5
- Adding shop sales to sage 30 2
- Money laundering and can accountants be sued by clients if they make a report 262 9
- self assessment repayment requesto 544 11
- What does the "K" signify 24 1
- Capital Gains Relief 189 7
- Directors Salary and Self Assessment (PAYE) 118 2
- Grammar, spelling and silly questions 993 42
- Pounds Shillings and Pence 676 26
- Tax on devidend in my company who is employee in other company 105 3
- Two weeks grace on self assessment where repayment is due? 216 4
- HMRC SA302s 50 1
- Investment from Friend 208 10
- Receipt bank 359 8
- Trading lossess & non trading co & investment income 70 1
- Do we have to register for VAT? 503 10
- Director remuneration £1000 only in year. paye registration required? 353 4
- Company dividends 554 15
- Tax Penalty overreaction 2,211 15
- Form MR01 (Particulars of a charge) - does this need to be filed if you remortgage with the same lender? 882
- Underpaid VAT assessment and relation to SATR 585
- Did you realise Google will not patch android exploit ... 546
- Latest phishing scam 481
- Entrepreneurs' relief 429
- Cashback for opening business bank acct = trading income? 353
- Corporate LLP with 30 June Year end - How to record on SA800? 327
- Auto Enrolment Questions Answered 251
- Penalties- On Tax Returns (New Regime) 251
- Loan benefit after person ceases as director/employee 175