If he repays the interest by money introduced, then no P11D is required.
However, if an accounting entry clears it, HMRC does not consider this a payment of interest.
Therefore P11D would be necessary.
That's my understanding. Perhaps other readers may have a different opinion?
Yes i have had a look but wanted to compare other and possibly cheaper options.
I have only a small number of clients and operating on a part time basis now.
Hello Basil
I thank you for your response and directing me to the relevant HMRC guidance.
I can see based on the HMRC guidance a return is not required as my client is no longer registered for Self Assessment therefore both conditions have not been met.
I have explained to my client that it would be prudent to write a letter to notify the HMRC of the gain although it is not mandatory. He has decided not to submit a return on the basis of the above.
I can see his point, and a penalty in my opinion would be highly unlikely as the taxpayer is following HMRC guidance.
Also it would probably be quicker to submit a return than to write a letter if one is required at a later date.
I found one with google but only gave the calculation for the director, not the overall picture taking into account the affect on the corporation tax payable.
Can you send me a link to the one you found if possible ?
If he actually actually paid the interest from his personal account to the company, i assume that this would remove the BIK of the loan account and no P11d would be required ?
My answers
If he repays the interest by money introduced, then no P11D is required.
However, if an accounting entry clears it, HMRC does not consider this a payment of interest.
Therefore P11D would be necessary.
That's my understanding. Perhaps other readers may have a different opinion?
Thanks
I thought that to claim input tax on a purchase, it had to relate to a taxable output?
I thought that to claim input tax on a purchase, it had to relate to a taxable output?
I would leave it.
The client has been informed so they wont question the correction in the next years accounts.
Save your self some time and hassle.
I thought i was a cynic regarding these webinars having watched a few of them, obviously not !
Hello Sarah
Yes i have had a look but wanted to compare other and possibly cheaper options.
I have only a small number of clients and operating on a part time basis now.
Thanks
Hello Basil
I thank you for your response and directing me to the relevant HMRC guidance.
I can see based on the HMRC guidance a return is not required as my client is no longer registered for Self Assessment therefore both conditions have not been met.
I have explained to my client that it would be prudent to write a letter to notify the HMRC of the gain although it is not mandatory. He has decided not to submit a return on the basis of the above.
I can see his point, and a penalty in my opinion would be highly unlikely as the taxpayer is following HMRC guidance.
Also it would probably be quicker to submit a return than to write a letter if one is required at a later date.
Thanks
Hello Joe
Unfortunately my spreadsheet skills are not up to it. I have tried unsuccessfully. Hence looking to acquire one.
Thanks
Hi Thanks
I found one with google but only gave the calculation for the director, not the overall picture taking into account the affect on the corporation tax payable.
Can you send me a link to the one you found if possible ?
Hi
Yes the loan account is still overdrawn.
If he actually actually paid the interest from his personal account to the company, i assume that this would remove the BIK of the loan account and no P11d would be required ?