The following Owner-Managed Businesses guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
Since the introduction of Finance Act 1996, interest payments for a limited company fall under the loan relationship rules, even if the company entered into the loan relationship for the purposes of its trade. There is, then, a distinction between trading and non-trading loan relationships. Generally speaking, a trading loan relationship will arise where a borrower has entered into the relationship to provide funding for its trade, otherwise the relationship will be a non-trading loan relationship. The loan relationship rules are now found in CTA 2009, Part 5. For guidance on loan relationships, see the Corporate debt ― overview guidance note.
For a property developer, finance will normally be required to some degree for a property acquisition and / or the development work itself. In this situation, the loan interest will be regarded as a trading loan relationship. CTA 2009, s 297(3) provides that trading loan relationship debits are treated as expenses of the trade and are therefore taken into account in computing the profits or losses of the trade for that period. CTA 2009, s 297(4) makes it clear that the loan relationships legislation overrides CTA 2009, s 54.
What constitutes interest can take a number of guises and it will be necessary to consider carefully any financial instrument entered into to distinguish what interest element may exist. The loan relationship legislation uses as a starting point inte
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Normal due dateIndividuals are required to pay any outstanding income tax and Class 4 National Insurance, Class 2 National Insurance, and capital gains tax due for the tax year by 31 January following the end of the tax year (ie 31 January 2021 for the 2019/20 tax year). From 6 April 2020, UK
Terminal loss relief for trade losses in the final 12 monthsTrading losses incurred by a company in the final 12 months leading up to the discontinuance of trade may be carried back for up to three years from the period beginning immediately before that 12-month period. So if the final accounting
This guidance note explains the general rules surrounding the availability of indexation allowance on the disposal of company assets and provides information on the rebasing rules for assets held on 31 March 1982. For an overview of the general position regarding company disposals, please refer to
Maintenance payments are payments made by a taxpayer to their former or separated spouse for the maintenance of that former spouse or their children. To obtain any tax relief for maintenance payments, one of the couple must have been born before 5 April 1935 and the payments must be made by virtue
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