On what basis are they batting the suspension back?
My only experience of HMRC refusing suspensions is:
1. When the penalty is deliberate
2. When there aren't clearly identifiable suspension conditions that can be applied and followed by the taxpayer in order to maintain the suspension.
If treated as gross payments then surely you don't need to treat as Directors Loan - it just forms part of the Directors remuneration? I don't believe it matters that it isn't a company scheme?
The old accountant didn't have any back up. He included exactly £450k so I believe he has used an estimate and not marked it as such on the tax return. I am just left unravelling it.
Interesting. Splitting the difference is what I would like to get to but the inspector doesn't seem willing to budge on the point at all.
Did you quote any cases or guidance in your argument?
The property was sold for £3.5m, so not particularly large in comparison to the overall value of the property.
It did include significant works. According to my client, the whole property was remodelled. Almost every room was upgraded (marble, cast iron, custom staircases etc.)
The problem is that my client's record keeping is poor. We just have a box of the larger receipts and nothing else to back it up. No architects drawings, plans etc.
Bank statements don't go back that far as we are talking early naughties.
My client has said that he would only ever keep receipts of costs of more than £500. All the smaller receipts for materials etc therefore weren't kept.
My hunch is that there were probably a lot of cash payments that receipts weren't kept for also.
Unfortunately relying on the mindset of the adviser isn't going to help me here - she is out for blood!
Yes that's what I was hoping for. Not a case specifically on settling expenses as I doubt this exists, but if anyone is aware of any cases that have included this or discussed it that would be great!
I'm a tax specialist, so I won't comment on the accounting side.
With regards to the shares, usually with a share buy back the shares are purchased by the company and then immediately cancelled.
It is quite a tricky area with lots of rules/conditions to watch out for. From a company perspective you need to ensure there are enough distributable reserves to fund the purchase and that the Articles of Association allow the buy-back.
There are also a lot of conditions that must be satisfied for the shareholder to receive favourable tax treatment. You should consider applying to HMRC for advanced clearance in this respect.
This article in Tax Adviser is quite helpful: https://www.taxadvisermagazine.com/article/purchase-own-shares
HMRC's helpsheet is also decent for POOS's: https://assets.publishing.service.gov.uk/government/uploads/system/uploa...