Deed of trust property company tax question

by Readers Question

22:45 PM, 17th September 2013
About 8 years ago

Deed of trust property company tax question

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Deed of trust property company tax question

I have a limited company registered in England.

I purchased a buy-to-let flat in England and it is registered in Land Registry in my personal name. It is my intention to renovate the flat and sell it with a tidy profit.

The lawyers drew up a Trust Deed at the time of purchase of the flat and I am the Trustee.

The deed records that I (as Trustee) acknowledge that I hold the property on trust for the Grantee (the Company) and that all income from the property shall belong to the Grantee.

Questions:

1. Should the flat be reflected as a Fixed asset in the financial statements of the Company?
2. When I sell the flat (at a profit), should the profit on sale be reflected as income in the financial statements of the Company?

I appreciate any help Deed trust property company tax question

Regards

Bruce

Comments

Mark Alexander

8:19 AM, 20th September 2013
About 8 years ago

Reply to the comment left by "Bruce Allsobrook" at "20/09/2013 - 07:32":

Hi Bruce

This is the man I suggest you speak to >>> http://www.property118.com/member/?id=452

Puzzler

12:59 PM, 19th October 2013
About 8 years ago

just come back to this thread:

First CGT for a higher rate tax payer is now 28% not 40%, second I think your accountant is right unless your company's business is property, HMRC do not like people mixing apples and onions and may consider it to be "aggressive tax avoidance".

The point about stock/WIP or fixed asset is important and again will depend what the rest of your business does.

Puzzler

13:14 PM, 19th October 2013
About 8 years ago

It sounds like yours is a one-off and you have had it for a while so it would be a fixed asset - I think CGT is also payable by a company, the sale proceeds would not count as income. If it is used in your business (you could turn it into a furnished holiday let) there are additional reliefs available, look at the HMRC website.

Bruce Allsobrook

16:26 PM, 23rd October 2013
About 8 years ago

Reply to the comment left by "Tony Atkins" at "20/09/2013 - 00:56":

Hi Tony
Would you mind passing on the name of your accountants?
I am trying to get a new accountant, but they do not revert back to me.

many thanks
Bruce

matchmade

12:16 PM, 24th October 2013
About 8 years ago

Reply to the comment left by "Bruce Allsobrook" at "23/10/2013 - 16:26":

Bruce: I would prefer to message you direct to save cluttering up the message board, but Property118 doesn't appear to allow this, so I will have to reply here. My accountants are Cranleys; they are based in Basingstoke.

Mark Alexander

12:26 PM, 24th October 2013
About 8 years ago

Reply to the comment left by "Tony Atkins" at "24/10/2013 - 12:16":

Hi Tony

Private messaging amongst members is on our "wish list".

Watch this space 🙂
.

Bruce Allsobrook

12:50 PM, 24th October 2013
About 8 years ago

Reply to the comment left by "Mark Alexander" at "24/10/2013 - 12:26":

That sounds good Mark - is there an estimated date?

Thank you Tony - I am currently discussing with Neil Barlow, but will keep the info you kindly sent as well.

Mark Alexander

13:10 PM, 24th October 2013
About 8 years ago

Reply to the comment left by "Bruce Allsobrook" at "24/10/2013 - 12:50":

Hi Bruce

I assume you are referring to the Private Messaging and not the Property Research Tool which I linked to at the bottom of my comment?

The Property118 website is built on a Wordpress platform and at the moment we have been unable to find a decent stand alone plugin which does what we want. We have looked into converting to Buddy Press but we would lose far more than we would gain. Wordpress plugins are being developed all the time so we hope somebody else will get around to it and we will use that code. If not, we may need to have code developed for us but that will be expensive and we will need to receive a lot more donations to make that happen. The answer therefore is that we don't really know how long it will take.

With regards to the Property Research Tool, that's is higher on our list and we commenced a seperate fund-raising project for that a few days ago and I'm pleased to say we are nearly half way towards achieving our target on that already. Therefore, fingers crossed, we may have the Property Research Tool ready to launch by this time next month 🙂
.

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