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Our client is the director/shareholder of his ‘one man’ IT consultancy limited company which has been operating for many years.
The company’s current single contract is coming to an end but it possibly has another contract in the pipeline. HMRC have previously agreed that IR35 does not apply.
The company has significant cash reserves and our client would like to buy a yacht for £350 000 plus VAT. We are aware of HMRC’s approach regarding ‘hobby’ assets for benefit-in-kind purposes and the capital goods scheme and potential capital allowance issues.
As such I am wondering if the company could be wound up at the end of the current contract via a ‘diy’ liquidation (£100 capital only) leaving the client to purchase the yacht personally; but would a claim for entrepreneurs’ relief (ER) be available?
The cash is on short-term deposits with no day-to-day management just...
Please reach out to customer services at +44 (0) 330 161 1234 or 'customer.services@lexisnexis.co.uk' for further assistance.
