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Sir, May i ask when the tax relief and subsidy benefit had to be calculate based on gross amount thank you
The tax relief and subsidy benefit are always calculated on the amount raised.
If the issue costs are being paid out of the funds raised then we need to gross up the amount needed for investment in order to get the amount raised.
If the issue costs are being paid out of existing funds, then the amount raised will be equal to the amount needed for investment and so doesn’t need grossing up.
Sir may I ask question Amberle dec 18 why the subsidy loan no need to grossed up?
Thank youThe examiners answer is not correct and given the wording of the question, the subsidy loan should have been grossed up for calculating the tax saving on the interest.
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