Question: Loan from Ltd Co A to Ltd Co B?

elliep

Hi

I am new here and need a bit of help.

Ltd Co. A is loaning Ltd Co. B £30,000 on a short term basis. How do I account for this is Ltd Co. A books? Would you class this as an expense or do you think it should be recorded elsewhere - bearing in mind it is only a loan and will be repaid within 12 months?

Your help here would be much appreciated. :001_smile:

Many thanks
Ellie

taxing-times

Hi Ellie

The loan to Ltd Co B will be a asset (debtor) of Ltd Co A. Therefore it should be recorded in the balance sheet as such.

The loan will not be an expense unless it becomes a bad debt.