Two Businesses

DottieDottie Feels At HomePosts: 99Registered
My client has a limited company - IT Consultant. He is going to invest some money in a beauty salon and wants to include this business in the same limited company. Can he do that?

Dottie

Comments

  • slackdaslackda Trusted Regular Posts: 460Registered
    Is the Beauty Salon Ltd? how much % Share of the bauty salon will his Ltd company own?
  • DottieDottie Feels At Home Posts: 99Registered
    It will be a new business and the company will own 100%. I don't think he can?
  • slackdaslackda Trusted Regular Posts: 460Registered
    If i remeber correctly he can but it has to reported differently ,it is a while since i looked at any group accounting stuff so excuse me for being rusty.

    I think that there are some IAS's (IAS 27) that cover group reporting, i.e the beauty company will report statutory accounts and the parent comapny will report statutory accounting, with a section that covers the beauty salons income expenditure etc.

    http://www.iasplus.com/standard/ias27.htm
  • qwertyqwerty Feels At Home Posts: 82Registered
    Group accounts???

    I assume you mean he will carry out both trades via the same company? A limited company can have many different trades (provided this is allowed via the Memorandum of Association).

    Therefore two trades in the same company is allowed. There may be restrictions on the use of losses for tax purposes if there are any (although I cannot see this being the case for an IT consultant!)

    Also, if it was a subsidiary, there would be no need to prepare group accounts if the group would be classed as small, which I suspect it will be.
  • DottieDottie Feels At Home Posts: 99Registered
    That is exactly what I meant!

    Thanks for your advice.
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