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Sam Pathak
Sam Pathak, Mr S Pathak MBA FCCA CTA
Category: UK Tax
Satisfied Customers: 464
Experience:  Tax Consultant & Freelance Lecturer over 9 years experience
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I have a UK limited company holding the shares of foreign trading

Resolved Question:

I have a UK limited company holding the shares of foreign trading company and I've had some expenses to pay relating to the transfer of the Shares and legal/notary work to appoint directors. Should those expenses go to the investment holding company or are they part of the trading business expenses.
Submitted: 1 year ago.
Category: UK Tax
Expert:  Sam Pathak replied 1 year ago.

Hello,

It's NOT a trade expense, but some other/legal/professional expense relating to the transfer of shares etc, so not incurred in the course of the company's usual trade/business.

This means this won't go against trade profit.

This can be recorded in the investment company. However, this won't be tax allowable there either, as only 'expenses of management' are allowable, and this does not appear to be so.
It's one-off sort of set up related expense, and nothing to do with the management of the investment or similar activity.

To conclude - regardless of whichever company's account was debited with the above expense, it's unlikely to be tax allowable, requiring to add back in the tax comp.

I trust the above clarifies.

Best regards
Sam Pathak
Sam Pathak, Mr S Pathak MBA FCCA CTA
Category: UK Tax
Satisfied Customers: 464
Experience: Tax Consultant & Freelance Lecturer over 9 years experience
Sam Pathak and 3 other UK Tax Specialists are ready to help you

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