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A husband and wife operate their consultancy through a limited company. They have purchased a small buy-to-let portfolio using directors’ loans
Our husband and wife clients run a consultancy from home through a limited company. The business has significant turnover and generates annual pre-tax profits in excess of £150 000. The clients pay themselves a small salary each and take dividends up to the higher income tax threshold.
They also have income from a small buy-to-let portfolio. Income from this source has been steadily increasing because the clients have added to their portfolio by funding purchases or part of the purchases through directors’ loans.
These loans are repayable on demand or within 20 to 25 years of the advance and interest is paid monthly at HMRC’s official rate. Separate loan agreements have been prepared signed by the directors and witnessed by ourselves.
The loans are reported in the accounts with current year debtors and have also been disclosed under the related party disclosure note. Tax under CTA 2010 ...
Please reach out to customer services at +44 (0) 330 161 1234 or 'customer.services@lexisnexis.co.uk' for further assistance.
