Director employed in Company A
Director owns minority share interest in Company B
Company A wishes to aquire the shares of Company B held by the Director
Company A has agreed the rice (500K) for the purchase of shares but as yet , no formal contract has been signed between the parties
As at 31/12/18 Company A has "loaned" Director 40K on the basis of anticpated share sale transaction
Question: Must this apparent "loan" be disclosed as DLA or is there any option to disclose as a prepayment against the anticpated share purchase ?
Many thanks
Replies (2)
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Any thought given to P11d reporting requirements, a few days to go.
Serious amount of money involved on share acquisition .
Wonder if the December 2018 accounts will reflect the contingent obligation .
If not a loan , no documentation ,could it be salary subject to PAYE.
When the £40,000 was minuted at the director's meeting what instructions were given to the bookkeeper on the accounting entries.
Wrestling with the classification of a transaction some 6 months or more after the event is questionable.
If the deal had been concluded by 5th April 2019, how would the £40,000 ''loan'' have been treated for PAYE P11d reporting purposes , lost in the champagne bubbles of £500,000 popping into director bank account?
So it's a loan or is it?