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Overdrawn DLA

Overdrawn DLA

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I act for a property development company. One of the 2 directors decided it would be tax beneficial to buy a property in her own name with an overdrawn DLA. This has resulted in a hefty S455 bill which is now seriously overdue. The only asset the company has is the DLA. Based on the said directors past performance (very complex) my instinct is to advise the other director to arrange a charge to be put on the property which apparently has very recently had an offer made on it. Can anyone advise if this is possible?

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By petersaxton
11th Jun 2016 19:46

a property development company which only has one asset - a loan to a director! what did the other director think of this madcap idea? given what you know about the director who has taken the money it sounds like a very reckless decision. I doubt whether a charge is going to help especially as it might inhibit any sale of the property.

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By moboffsol
12th Jun 2016 00:11

Yes crazy I know. One of the directors is a wealthy middle aged gentleman and the other director is a woman 20 years his junior who has quite frankly manipulated him. It is only since the s455 bill dropped in the post has he started to smell the coffee.
She has been ordered that the funds from the sale of the property are to be paid directly back to the company. He can only hope that she does.
This is the 2nd property in her name. The first property sold in February making 45k profit which she duly spent even though she did not contribute a penny. The property company was set up with a loan from another company he is sole director of.

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By johngroganjga
13th Jun 2016 10:30

Yes of course it's possible for a creditor to take a charge over a debtor's asset to secure his lending. But it obviously needs the debtor's agreement and co-operation, and for that reason is normally put in place as a pre-condition of the lending rather than after the event.

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