I have a situation that I need a quick answer for as I am too busy to research at the moment. I have a group of companies in which a subsidiary company (S) owes money to a parent company (P). The debt arose from a loan to S and increased due to trading between the compaies as well as interest being charged by P company to S on the outstanding loan.
S is not in a position to repay these loans and is in the process of being sold off. Therefore P has decided to waive the entire balance prior to the completion of the sale. S358 of Corporation Tax Act 2009 suggests that the write off of the loan in S will not be taxable. I would appreciate any comments on this point.