Taxed twice? Incorporation
Hi - farming partnership considering incorporating fully or maybe just putting in the plant & machinery to form a company that would do the 'farm work'.
The sale of the plant & machinery would crystallise a gain for CGT albeit at 10% re entrepreneur's relief and as is usually the case the 'purchase' price would become a directors loan in the company.
Am I right in thinking that if any of the directors then dies fairly soon into the formation of the company then IHT becomes due on the 'directors loan'? - Effectively surely the same money being taxed twice?
Suppose you would cover this potential libility off by buying some term / reducing term assurance on each of the director's lives (altho age / health of 1 of the directors could make cost of policy prohibitive.
Also - if the land is held outside the company presume that a formal tenancy req'd to maintain APR relief.
But again looking at IHT if one of the directors were to die within the 7 years that the company should have 'ownership' of the land & or the 2 years 'occupation' of the land then would there be implications for APR - suppose I am asking here the wisdom in doing anything which may involve IHT ivo the health of 1 of 'them' not being particularly robust.
Many thanks in advance for comments!
- where has the honest passion to help gone..??? 849 18
- Company Accounts 102 2
- Any Scottish members out there? 9,180 343
- Getting VAT right for a sole trader pilot 174 6
- Vat treatment of charity business income 90 5
- Donations (to a school!) 423 11
- Vat on Royalites 79 1
- 100% Xero practice 2,110 34
- Umbrella Company 136 2
- Outsourcing iXBRL Tagging 422 24
- Payroll YTD info on Operaii 75 1
- Treatment of goodwill in Consolidation 148 5
- Mortgage deposit Gift 426 18
- Profitable company wanting to buy an office 164 3
- property rental income split 254 3
- Shadow director or alternative? 468 4
- Does my client qualify for CGT Loss? 130 1
- EIS/SEIS capital gains exemption 95 2
- About to buy a block of fees. Any advice? 1,269 5
- Use of home for storage 329 6
- Raiders of the Lost Tax File 1,188
- Chartered Accountant in County Down N.Ireland 404
- IPP (International Pension Plan) income 315
- National Insurance 310
- valuation of intangible asset FRS10 and FRS20 261
- Unnecessary S9A Enquiries 235
- Cass 5 FCA Client Money Software recomendation 234
- Non Resident 221
- Franchise income and costs 204
- A question for the payroll-only bureau's out there 155