Managing and operating two companies

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT member discussion
Hi everyone

Advice please. I have a client who is a security partnership firm. He is considering taking over another security firm and running it separately to his existing one. He and his existing partner will be owners/partners to the new firm.

Can anyone please advise me of the tax implications in this and what the partners should be aware of????

Thanks
Siany

    Comments

    • System
      System Posts: 100,534 🤖 Admin 🤖
      Re:Managing and operating two companies

      Hi Siany

      So, this is actually two partnerships each run by the two individuals, as opposed to two companies?

      This would mean that each partner has 'extra' income each year from another partnership, which they will be taxed on, at whatever tax band they fall into.

      Regards
      Tom
    • System
      System Posts: 100,534 🤖 Admin 🤖
      Re:Managing and operating two companies

      Just be careful that this is not a move to avoid registering for VAT - ie two "companies" both having a turnover of say £55,000 - HMRC take a particularly dim view of disaggregation.

      If it is purely a commercial decision as the two companies have different customer bases and maybe different charging policies, then nothing I can think of to be aware of apart from what I have said above.

      Claudia
    • System
      System Posts: 100,534 🤖 Admin 🤖
      Re:Managing and operating two companies

      Yes, my thoughts exactly. If the two companies are not registered for VAT, I would check the VAT implications straight away and get a letter in writing from the VAT Office if registration is not necessary.

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