I seem to be getting in a bit of a mix here and wondered if someone on here might be able to clarrify something for me.
I have a client with a co structure Topco->Trading Co 100% ownership. Topco does does nothing other than hold the trading co and receive dividends.
The client wants to purchase a buy-to-let property from the cash pile sitting in Topco and is considering either purchasing the property in topco, or lending the money to a separate co (owned by the same shareholder) that will then purchase the property.
My understanding is that the direct purchase would jeapardise the availablilty of entrepreneurs relief as the assets in the top co would be more than 20% non-trading. Similarly the loan would do the same as it is also a non-trading loan.
But then if there is excess cash in the company that would also jeapardising it.
Am I missing something here?
My thanks in advance...