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Property poser

© Copyright LexisNexis 2024. All rights reserved.

11 February 2009

Issue: 4193 / Categories: Forum & Feedback , Capital Gains

A company has ceased trading and it has used the surplus funds of its retained profits to purchase an investment property. What effect will this have on the possibility of any future claim to entrepreneurs’ relief by the shareholders?

Our clients were the directors of a successful trading company. A few years ago the company ceased trading and approximately £200 000 remained in the company bank account.

The directors wished to invest the money and on the advice of their previous agent this was used to purchase a property that was then let out.

My concern is that I am now dealing with an investment rather than trading company and that entrepreneurs’ relief would not be available if the company were to be wound up.

Is it too late for this relief to be claimed by the shareholders if the company were to sell the property and be wound up now?

On the subject of selling the property the company director/shareholders are able to purchase it from the company.

They estimate that at the present time the property is only worth about £150...

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Property poser

© Copyright LexisNexis 2024. All rights reserved.

11 February 2009

A company has ceased trading and it has used the surplus funds of its retained profits to purchase an investment property. What effect will this have on the possibility of any future claim to entrepreneurs’ relief by the shareholders?

Our clients were the directors of a successful trading company. A few years ago the company ceased trading and approximately £200 000 remained in the company bank account.

The directors wished to invest the money and on the advice of their previous agent this was used to purchase a property that was then let out.

My concern is that I am now dealing with an investment rather than trading company and that entrepreneurs’ relief would not be available if the company were to be wound up.

Is it too late for this relief to be claimed by the shareholders if the company were to sell the property and be wound up now?

On the subject of selling the property the company director/shareholders are able to purchase it from the company.

They estimate that at the present time the property is only worth about £150...

If you or your firm subscribes to Taxation.co.uk, please click the login box below:

If you are not a subscriber but are a registered user or have a free trial, please enter your details in the following boxes:

Subscribe Now...

Alternatively, you can register free of charge to read a limited amount of subscriber content per month.

Once you have registered, you will receive an email directing you back to read this item in full.

Please reach out to customer services at +44 (0) 330 161 1234 or 'customer.services@lexisnexis.co.uk' for further assistance.

Issue:

4193

Categories: Forum & Feedback [1] , Capital Gains [2]

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