Dear collegues. I would very much appreciate your input on this. A client, a property partnership, wants to incorporate for commercial reasons. Has huge bank loans & to avoid CGT on loans, we asked the bank to transfer the loans over to the newly-formed co without paying them off before incorporation & if it wishes to refinance which it does to do so after inorporation. Eventhough the client has been a client of this bank for over 40 yrs, the bank insists on paying off & refinancing loans with higher interest rates before incorporation. Assuming we get clearance from HMRC if we went ahead & transferred the loans at their book value into the newly-formed co & notified the bank on the first day of incorporation that the loans are now in the company in which case they will pay off old loans in the partnership & refinance in the name of the new co., would this present any problems with the bank? I would be most grteful for your comments.
13th Jul 2020
Partnership Incorporation & Bank Loans
Partnership incorporation & transfer of bank loans
Share this content