Conundrum - help please!
Monsoon
Registered Posts: 4,020 Beyond epic contributor 🧙♂️
A Ltd Co sublets from a separate company. There is no paperwork drawn up (!).
The sublet was on the agreement that the Ltd Co pays the stamp duty that the other company incurred in acquiring the lease.
So, the Stamp Duty is in the P&L for the Ltd Co as they had to pay it.
Clearly it's not stamp duty, because the Ltd Co wasn't chargeable to SD.
It IS a payment for business, that relates to a lease. But there was no paperwork drawn up (sigh).
IMO it has to be revenue, not capital - becaue the Ltd Co doesn't own a lease, so they don't have a capital item. But what is it and is it allowable for tax?
I'm reading up on lease premiums but I can't for the life of me see how to treat it in the accounts of the payer, I can only see the CG treatment for the recipient of the premium, so I'm none the wiser on that front.
Halp!!!
The sublet was on the agreement that the Ltd Co pays the stamp duty that the other company incurred in acquiring the lease.
So, the Stamp Duty is in the P&L for the Ltd Co as they had to pay it.
Clearly it's not stamp duty, because the Ltd Co wasn't chargeable to SD.
It IS a payment for business, that relates to a lease. But there was no paperwork drawn up (sigh).
IMO it has to be revenue, not capital - becaue the Ltd Co doesn't own a lease, so they don't have a capital item. But what is it and is it allowable for tax?
I'm reading up on lease premiums but I can't for the life of me see how to treat it in the accounts of the payer, I can only see the CG treatment for the recipient of the premium, so I'm none the wiser on that front.
Halp!!!
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Comments
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Ooooo Errrrrr! Me thinks you need to ask an accountant!!!!!
FMAAT - AAT Licensed Member in Practice - Pewsey, Wiltshire0 -
Sounds like rent to me..0
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Renting is not subject to SD.0
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I would treat it as a revenue expense - rent like Dean has said because there is no paperwork to say that is a capital expense.0
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Cheers folks. Yep, adding it to rent paid was my gut feel too, so that's what's happening.
Don't you just love straight forward jobs?!
Hasan - true, but the other company bought the lease and there was SD payable on it and they stipulated my client pay it.0 -
Sounds like rent to me as well.Regards,
Burg0 -
Cheers Ian.
Job's all done. Phew. So much to do before I go away on holiday! 0
