Loan written off

This topic has 3 replies, 2 voices, and was last updated 6 years ago by Tax Tutor.

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October 10, 2019 at 8:32 am #548569

jawad253
Member

Hi

Can You if we write off a loan from group undertaking what will be the tax treatment???
My entry for write off is

Dr. Inter company loan

Cr. Income

October 10, 2019 at 1:46 pm #548658

Tax Tutor
Member

Firstly we are not concerned with the double entry in the accounting system – we are of course concerned with the tax treatment of a loan write off and bad debt relief is not available on the write off of connected party loans ie within a group

October 10, 2019 at 5:49 pm #548692

jawad253
Member

Hi thanks for your reply ,
Bad debt relief is not available in case of debtor company write it off and what about the tax treatment in case of creditor company , which doesn’t have to pay anything in case of write off ??
That’s why i have mentioned the entry .

October 13, 2019 at 3:11 am #548949

Tax Tutor
Member

It is neither an allowable expense or taxable income in the companies involved
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