Costs of a separated couple

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PGM
PGM Registered Posts: 1,954 Beyond epic contributor 🧙‍♂️
I've been asked a question that I don't know the answer too;

Two people in a relationship, him a builder, her paying some of the costs on his behalf to keep the business running.

She asked; now that they're seperated, can the costs she paid for go against her tax bill?

Obviously they're not a cost to her business, and the payments made are really a business loan...?

Can these costs be highlighted as a business loss against profit?

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  • T.C.
    T.C. Registered, Tutor Posts: 1,448 Beyond epic contributor 🧙‍♂️
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    I don't follow you....can you explain?
  • deanshepherd
    deanshepherd Registered Posts: 1,809 Beyond epic contributor 🧙‍♂️
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    I assume you meant 'she' paying some of the costs on his behalf.

    In which case no. They can be set against his profits but not hers as they are not wholly and exclusively incurred for the purposes of her trade.
  • PGM
    PGM Registered Posts: 1,954 Beyond epic contributor 🧙‍♂️
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    I assume you meant 'she' paying some of the costs on his behalf.

    In which case no. They can be set against his profits but not hers as they are not wholly and exclusively incurred for the purposes of her trade.

    Thanks Dean, thats what I meant, with my rambling explaination.

    Is there any way that it can be treated as a business loan? It may not be the main nature of trade, but many entrepreneurial people have many natures of trade...
  • deanshepherd
    deanshepherd Registered Posts: 1,809 Beyond epic contributor 🧙‍♂️
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    It can but a loan is a balance sheet item so no income tax relief there either.
  • PGM
    PGM Registered Posts: 1,954 Beyond epic contributor 🧙‍♂️
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    It can but a loan is a balance sheet item so no income tax relief there either.

    Whats the correct treatment when it becomes a bad debt? And I suppose thats if done through an existing business.

    I suppose you're crossing into dodgy areas if you try and say its a loan business, with just the one loan, thats now a bad debt :D
  • deanshepherd
    deanshepherd Registered Posts: 1,809 Beyond epic contributor 🧙‍♂️
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    Not if she is willing to apply for a Consumer Credit Licence and be regulated by the FSA as a money lender!
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