Can I change the entire purpose of my IT Ltd Company?

[Maslins]

so moving on a step, my annual accounts for the last 12 months are due in January and they'll show a healthy profit with little room for expense deductions so I'll have a large Corp Tax bill to pay late next year. However, if I draw money from the firm out during the year and end up losing loads, will that be deductible under Mandelson's small firms bill (the one where you can deduct current losses from previous years profits in times of crisis). Basically, could someone make a load in IT, buy a pub, get pissed with his mates for 6 months then bounce off into the ooloo free of tax debt? Seems odd. Also - this isn't my plan!

For losses carried forward there is a specific stipulation that they can only be set off against profits of the same trade...but that rule doesn't apply to losses carried back, so yes, I think you could set losses of a pub trade against previous profits of an IT trade, but not the other way around.

Obviously if you give away all the beer your pub buys free to you & your mates, you'd have other tax issues. In theory you should pay sales price (not cost) for any goods you take for personal use from the company.

[BrilloPad]

Morning gents and possibly the occasional lady,

Quick question - my latest Ltd. Co. has been going for 3 years and lasted 2 contracts. I'd now like to totally change track and run a different sort of business. Not sure what yet but probably a training firm or buying / selling - maybe even a pub for a bit. Question is - can I use the money in the Ltd Co to finance the "new" business. If not, do I need to pay CGT on all I take out then pay that again when I take it out of the new Ltd Co?

Thank you,

Richard
That London

I did similar with my limited. My accountant said a note in the companys AGM was enough.

[singhr]

I know some contractors who ran a similar scam to fund their love of flying, setting up a 'flying school' and funding it through their IT activity. HMRC soon pointed out the error of their ways.

[moorfield]

then bounce off into the ooloo free of tax debt? Seems odd. Also - this isn't my plan!

Interesting theory that... You may get away with it (if you did do it), but not without being disqualified as a director I would imagine. Then, as the saying goes, "you'll never waitress in Torquay again", unless you work for a brolly.

[Citychap]

so moving on a step, my annual accounts for the last 12 months are due in January and they'll show a healthy profit with little room for expense deductions so I'll have a large Corp Tax bill to pay late next year. However, if I draw money from the firm out during the year and end up losing loads, will that be deductible under Mandelson's small firms bill (the one where you can deduct current losses from previous years profits in times of crisis). Basically, could someone make a load in IT, buy a pub, get pissed with his mates for 6 months then bounce off into the ooloo free of tax debt? Seems odd. Also - this isn't my plan!

[xoggoth]

Change the classification in your company annual return too.

[Citychap]

I don't see why not. After all, Berkshire Hathaway was originally a cotton mill, and is now an investment company.

IINAC but I think you may only need to change your VAT classification and maybe put some statement in your annual accounts.

Cracking stuff - I can take the money out and use it on something I really want to do. Perfect. I want to train people to do this job not actually do it anymore

[Moscow Mule]

BTW - what is an "occasional lady" ??

Is it a bit like an occasional table?

[Citychap]

BTW - what is an "occasional lady" ??

'bout 100 quid an hour for a good one







apparently

[moorfield]

the occasional lady,

BTW - what is an "occasional lady" ??

[moorfield]

I don't see why not. After all, Berkshire Hathaway was originally a cotton mill, and is now an investment company.

IINAC but I think you may only need to change your VAT classification and maybe put some statement in your annual accounts.

[Citychap]

Morning gents and possibly the occasional lady,

Quick question - my latest Ltd. Co. has been going for 3 years and lasted 2 contracts. I'd now like to totally change track and run a different sort of business. Not sure what yet but probably a training firm or buying / selling - maybe even a pub for a bit. Question is - can I use the money in the Ltd Co to finance the "new" business. If not, do I need to pay CGT on all I take out then pay that again when I take it out of the new Ltd Co?

Thank you,

Richard
That London