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My client carries on a part-time trade via a limited company.
When preparing the 31 March 2007 accounts and 2006-07 tax return I found that the director's account was overdrawn by just under £1,000. This is a secondary source of income for the client and, in the past, earnings have been left in the company and no remuneration or dividends have been drawn.
My client carries on a part-time trade via a limited company.
When preparing the 31 March 2007 accounts and 2006-07 tax return I found that the director's account was overdrawn by just under £1 000. This is a secondary source of income for the client and in the past earnings have been left in the company and no remuneration or dividends have been drawn.
I realise that we are not talking about a large amount of money and that the client will have to take a decision before 31 January but for future reference I would be interested in hearing readers' views on the best way of dealing with this type of situation.
Declaring a dividend for the year and showing this on the tax return seems an easy answer but would it be better to take a 'hit' under TA 1988 s...
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