I've a client who loves to throw curve balls at me.
He has several companies, most of which he is always transferring monies around in.
Anyhow one of his companies hasn't traded for a couple of years but has two large debtors on its books which are both companies wholly owned by himself. This is basically monies that he has transferred from this company to his other companies. They stand at over £200k.
He now wants a clean Balance Sheet on this company, so wants to transfer the debtors to another company that he owns. I just can't see how this can be done. If I reduce the debtors then the only other option is to reduce the shareholder funds ie profit and loss account. And if the debtors are now included in the new company presumably the other side of the entry would be to increase the shareholder funds ie increase P&L. Is this creating a taxable event? My head is spinning with this scenario (of top of the normal Covid19 questions) and of course he wants it all done today.
Any advise/help/thoughts please. Thanks in advance.