Help!
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Can someone please confirm something for me.
My cousin has recently purchased a business which her parents financed by remortgaging their house.
Am I right in thinking the money is just treated as Capital Introduced by the owner, and the mortgage is not shown in the accounts (as it is not a business loan, and not secured on the premises or anything)
This being the case - I take it that mortgage interest is not allowable either?
My cousin has recently purchased a business which her parents financed by remortgaging their house.
Am I right in thinking the money is just treated as Capital Introduced by the owner, and the mortgage is not shown in the accounts (as it is not a business loan, and not secured on the premises or anything)
This being the case - I take it that mortgage interest is not allowable either?
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Comments
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Re:Help!
You are correct in treating the funds as capital introduced.
We have a client who did this as well - arranged an equity release to fund business expansion. The mortgage interest isn't put through the accounts, but instead relief is claimed against the interest through our clients tax return. You must be careful to ensure only the amount of the loan interest attributable to financing the business is claimed and not the whole mortgage interest.
Kind regards
Steve
p.s. what a fantastic avatar!0 -
Re:Help!
Thanks! And Thanks.0