Incurring cost in UK company

[Lance]

without going into details about the business plan, I already spoke with bank about it and they are OK with my plan but need to show profits on the first accounting perdiod. Hence the constraint about profits and no debt in company B. And getting funding is the core of my strategy

Oh I see.

It's not capital investment. It's fraudulent purchasing (ie. not a purchase but made to look like in order to defraud the bankers)..

A bit like this HP Autonomy - Wikipedia
Autonomy's books were cooked to look like they'd sold more than they had. I don't think anyone has gone to prison yet.

[Lance]

Yeah but if those profits are completely manufactured and are not an indication of the viability of the business a bank will run a mile. They want profits to show it's a quality company that can fulfil any obligation the bank puts on it. You funding it some hooky way and the business is failing or non existant they aren't going to lend it money are they. That would just be madness giving money to any company that's actually got zero ability ot make any money.

Quick check to see where the money came from and it turns out it's from some other UK ltd owned by you with zero work/goods actually being delivered isn't going to work.

and is fraud

[eek]

why would company B declare investment capital as profit???? That's really dumb IMO

Because it's not investment capital - it's faked income from the EU company invoicing the UK company for things that haven't been done.

I really have no difficulty with it beyond the fact HMRC will love this if you are a UK tax resident...

[Lance]

Because it's not investment capital - it's faked income from the EU company invoicing the UK company for things that haven't been done.

I really have no difficulty with it beyond the fact HMRC will love this if you are a UK tax resident...

yep.... I realised..

https://forums.contractoruk.com/acco...ml#post2970604

[GitMaster69]

Cooking books, defrauding banksters, entrepreneurs bad - keep them coming

[Lance]

Cooking books, defrauding banksters, entrepreneurs bad - keep them coming

So what bit of putting money from one company into another, made to look like a purchase, when there is no purchase, to get someone to lend the company more money, isn't fraudulent?

Please explain in words of one syllable or fewer cos I don't get it.

[GitMaster69]

So what bit of putting money from one company into another, made to look like a purchase, when there is no purchase, to get someone to lend the company more money, isn't fraudulent?

Please explain in words of one syllable or fewer cos I don't get it.

Whatever! I want to invest! I'm way beyond tax efficient threshold to draw personally. How to do it and not be screwed on tax is the question!

Think of it as an SPV, the difference being in SPV you can have only 1 property for bank to give you mortgage.

[eek]

Whatever! I want to invest! I'm way beyond tax efficient threshold to draw personally. How to do it and not be screwed on tax is the question!

Problem 1 - you are UK tax resident and moving money abroad without a valid reason.
Problem 2 - you seem to have bank loans based on being profitable but the only income seems to be coming from your UK company..

[northernladuk]

Problem 1 - you are UK tax resident and moving money abroad without a valid reason.
Problem 2 - you seem to have bank loans based on being profitable but the only income seems to be coming from your UK company..

Only two problems? Or is that just for starters?

[GitMaster69]

Problem 1 - you are UK tax resident and moving money abroad without a valid reason.
Problem 2 - you seem to have bank loans based on being profitable but the only income seems to be coming from your UK company..

ok thanks everyone. It's hard to get advice without putting everything on the table, especially when topic keeps deviating to secondary things
Might need professional advice
all the best