Helen Coward and Lewis Currie (Charles Russell Speechlys) consider the consequences of unlawful distributions by UK companies, including the tax pitfalls to avoid.
In this article we consider the key considerations from a UK company law perspective in relation to establishing whether a distribution is unlawful the tax implications which may result from an unlawful distribution and potential ways to mitigate those tax implications in practice.
All statutory references are to the Companies Act 2006 unless otherwise indicated and this article deals with the position of UK private limited companies only.
Company law position
Determining the company law position of whether a distribution has been unlawfully made is fundamental to establishing the tax position. This requires consideration of whether:
there has been a distribution for company law purposes at all (having regard to the availability of realised profits); and
the recipient had knowledge or...
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Helen Coward and Lewis Currie (Charles Russell Speechlys) consider the consequences of unlawful distributions by UK companies, including the tax pitfalls to avoid.
In this article we consider the key considerations from a UK company law perspective in relation to establishing whether a distribution is unlawful the tax implications which may result from an unlawful distribution and potential ways to mitigate those tax implications in practice.
All statutory references are to the Companies Act 2006 unless otherwise indicated and this article deals with the position of UK private limited companies only.
Company law position
Determining the company law position of whether a distribution has been unlawfully made is fundamental to establishing the tax position. This requires consideration of whether:
there has been a distribution for company law purposes at all (having regard to the availability of realised profits); and
the recipient had knowledge or...
If you or your firm subscribes to Taxjournal.com, please click the login box below:
If you do not subscribe but are a registered user, please enter your details in the following boxes:
