Taxi company or sole trader?

Taxi company or sole trader?

13:18 PM, 23rd August 2018, About 5 years ago 2

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I am buying a detached property for slightly over the property value as it has land that had planning permission for another 3 bed detached property. I plan to either convert existing property into 3 flats and build a further 3 flats to the side, or demolish as my planner feels I can get 9 flats.

I am purchasing the property in my name and I am semi retired. I do have a limited company in a taxi rental business that I was going to close, is it tax advantageous to build the properties in my limited companies name.

My company has been running at a loss due to the value of my fleet of cars declining through age/mileage.


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Neil Patterson

13:30 PM, 23rd August 2018, About 5 years ago

Hi Paul,

A much more in-depth look at the figures is required by your accountant here to make a judgement.

Using offset loses would on the face of it make sense, but how much are there and what profits do you anticipate making.

What would be your total personal income in the future for tax purposes.

Are you going to sell and do you have previous personal losses you could use?

Please also read our article "Is it better to build a rental property portfolio in a Limited Company?" >>

And all the information, case studies, related articles, video and downloads on our Tax Planning page >>

Simon Lever - Chartered Accountant helping clients get the best returns from their properties

11:30 AM, 25th August 2018, About 5 years ago

If you would be looking to use the taxi business losses against any property profits in the limited company I doubt that HMRC will allow the offset of the losses.
In general the losses can only be used to reduce profits from the same trade or profession which is clearly not the case in this instance.
Check with your accountant before making any decision.

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