Halifax Courier

Tax affairs are made simple

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business at 5% per annum. Her only other income is a small salary of £10,000 a year from her husband’s business. The £5,000 interest would potentiall­y save up to 45% income tax plus national insurance for Mr Smith, whereas Mrs Smith would receive £5,000 interest tax free. CAPITAL TAX IMPLICATIO­NS OF THE LOAN Although the loan to the business in the example above is tax efficient (in that there is no income tax due from 6 April 2014) it would also be important to consider the CGT and IHT implicatio­ns of the loan. Should the business default, it may be possible to obtain relief as a capital loss against capital gains in the same or future years. There would, however, be no inheritanc­e tax business property relief should the lender die with the loan in place. Please contact us for further advice in this area. Please contact a member of our Tax Team if you would like to discuss any of the issues raised in this newsletter. You can find our details through www. broadbents­ltd.co.uk (Please register) or phone us on 01422 347 880.

 ??  ?? Adrian Broadbent
Adrian Broadbent

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