My client has invested £100k in a small venture (by way of a loan) and it has failed - Big Time - so much so that the venture itself is about to go into administration.
There are no creditors other than him and his loans
He has been advised by the IP who is about to be appointed that if he capitalises the loan to shares, the winding up will not be an insolvent winding up and so it will be cheaper fees, and there will not be any future issues around the directors necks.
My concern - and I thought I recalled reading it on Aweb somewhere, was that if he did this, he would not get future CGT relief on that 100k as he was capitalising the shares now knowing they were worthless
I would be grateful if someone could confirm - or correct me as I may be getting wires crossed insofar as it might be that capitalising will restrict the income tax loss relief that might otherwise have been available
Thanks in advance