I have a client who has a bunch of credit cards that he has been using for his limited company. This is my first year with him and it looks as though he funded the company via a personal credit card and is now balance transfering every 6 months or so, occasionally incurring bank charges.
From what I can see the card debt was accounted for in the PY as a company debt not a directors loan. My initial instinct is that the debt is not the company's and therefore should, if anything, be accounted for as a directors loan. Any charges and interest incurred would be a matter for the self assessment, not for the company and CT600.
Are there any circumstances where one might include it as a company debt? It is in reality a company debt but a liquidator would not see it that way. The costs incurred are purely as a result of the company owing money to the credit card company, albeit via the director.
Is saw this and thought it may have some relevance (https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim01010 ).
Before I go back to the client and disappoint him with the news that its a directors loan and he will have to manage to it through the self assessment (which he is insisting on doing), is there a way we can manage it through the company?
I would be interesting in hearing what others would do in this situation, and any pointers to HMRC legistlation etc