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Buying a Commercial Property with loaned money

Buying a Commercial Property with loaned money

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Dear kind fellows,

I have remortgaged my residential property to raise funds to purchase a commercial property with an existing lease, through my limited company.

I will be giving a loan of around £100k to my limited company to buy this commercial property. As I will be loaning my own company, I won't be charging any interest.

My question is that will I be taxed (corporation tax) on the rental income BEFORE or AFTER making my loan payments to myself? Are the loan payments allowable expense under limited company?

Secondly, will I have to pay any personal tax on the loan payments I receive from my company? Please note, that the loan payments I receive are likely to be higher than the mortgage payments on my personal residential property.

Thank you kindly 

Replies (8)

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By Accountant A
18th Nov 2019 19:01

Could you tell us what professional advice you have received so far.

Have you managed to find a solicitor to carry out all the legal work for free? I'm sure there are loads of lawyers out there willing to give away their expertise for nothing. Accountants do it all the time.

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Psycho
By Wilson Philips
18th Nov 2019 19:25

Before
No
No

Those are the answers to the questions raised. However, there are other issues to consider and on this point I agree this time with Accountant A - paying for professional advice is likely to prove rewarding.

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By SXGuy
18th Nov 2019 19:28

Please seek an accountant.

It's clear from your questions you have no idea what you are doing or talking about.

And non of us are gonna spend hours for free explaining it all to you. Can I rent your commercial property for free? I doubt it.

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By shan1234
18th Nov 2019 19:39

Hi guys.
Thank you for your replies. I am a bit puzzled by your replies. I was of the understanding that this forum is to get free advice from experts as part of a community spirit. If this is not the case then what’s the purpose of this group?
I can surely get expert advice and happy to pay for it but then what’s the benefit of such community groups

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Replying to shan1234:
Psycho
By Wilson Philips
18th Nov 2019 19:44

The obvious reply - do you consider yourself to be a member of the professional accountancy and tax advisers community?

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Replying to Wilson Philips:
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By shan1234
18th Nov 2019 19:46

I see so this group is for accounting professionals then that’s not me

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Replying to shan1234:
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By Accountant A
18th Nov 2019 20:29

shan1234 wrote:

I was of the understanding that this forum is to get free advice from experts as part of a community spirit.

Funny how the biggest fans of community spirit are the ones who contribute fuch all to "the community".

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By johngroganjga
18th Nov 2019 19:48

The loan repayments are not even expenses of the company, never mind expenses allowable for corporation tax. If your thinking is so lacking in clarity you should stop trying to work it out yourself.

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