I've seen an interesting use of a limited company and was wondering if anyone could shed any light on it and any potential problems that could arise by someone who is already using this. The details are fairly vague but aweb users seem a bright bunch so might be able to help.
There is a partnership providing care services (it has remained a partnership because it was registered on sympathetic terms and these are not guaranteed if registered again by a ltd company), this obviously means less favourable tax arrangements for the individuals involved. Their accountants then advised them to set up a limited co and it appears that "management/consultancy" services have been charged by the limited co to the partnership but no money has been exchanged just the debtors are growing in the limited company. How owners of a business can charge for services provided to their business seems odd to me.
This was apparently legit when set up but is no longer available to people who wish to do it now but is ok to carry on with.
It seems a bit fishy to me so if anyone could shed any light on it it'd be most appreciated. I don't want them to potentially get stung further down the line for bad advice.