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Hauled off

18 August 2009
Issue: 4219 / Categories: Forum & Feedback
Before it became insolvent, a director paid expenses that were the liability of the company. Can tax relief be obtained for these costs?

We act on behalf of the director of a haulage company that has recently gone into liquidation.

The haulage company had six directors while it was trading. During the last three months of trading the company did not have the financial resources to pay for some of the fuel for the lorries and a telephone bill.

Consequently the director paid these expenses amounting to £10 000 from her own income; the income was her net salary from the haulage company. All the expenses are fully documented through the personal bank account and she has all the invoices.

Our question is whether we can claim these as expenses against her employment income?

If we had been acting as advisers at the time we would have advised that she reduced her salary and the company paid the bills.

Query 17 453 – Laurie

Reply from Exile

My immediate...

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