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Investment in Subsidary accounting

What should be included in the investment?

My Client is looking to purchase and develope a property. In order to save stamp duty, rather then purchse the property, they are purchasing the Company that owns it.

My understanding is that we will need to post the Purchase prices, legal costs and finance costs to investements in subsidary on the parent company.

THe finance costs are the banks legal fees, Valuation fees and a 1% arrangement fee. The one area I am unsure of is the Arrangement fee. I normally amortise this across the term of the loan but I dont see how I can do this if it is in investment .

Companys are both Ltd.

I

 

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07th Feb 2019 12:44

What is the arrangement fee for then, if not for a new loan?

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07th Feb 2019 13:01

THe Arrangement fee is for the new loan. Sorry if I was unclear

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to Gardinho
07th Feb 2019 13:49

Well you said "I normally amortise this across the term of the loan". So why don't you just do what you normally do?

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