startup-costs, funding, taxI am looking at setting up a new business. I currently have a UK Limited company with an amount sat in the bank (lets say £10k) That I would like to use to fund this new (unrelated) startup, which will also be a Uk LTD company. The money will be paid back to the first company as quickly as possible.
What is the most tax efficient way to use funds sat in one business to fund a another startup business? Some sort of “Loan” agreement?
This is a UK based question.
You need qualified advice. My suggestion is this.
You’re never many days or many miles from someone running a seminar on R & D Tax Credits. Find one that’s convenient, and sign up.
Whatever the content of the presentation, your question is, “What other approaches should I consider to optimise tax efficient investment in a new venture?”
Use the occasion to get an idea of different approaches, and the dynamics of each. If you don’t hear about anything other than tax credits, book another seminar with a different speaker.
Just like pursuing product/market fit, the best and fastest learning often comes from guessing at an answer, and using that to engage with the market.
I am not an accountant however,
A loan between company A and Company B should have no further implications on tax (Beyond the fact that they are already associated companies through your presence in both) because loans do not effect profits.
There are probably complicated ways of doing it but many of the tax relief schemes I know of for small businesses cannot be claimed by ‘connected’ people.
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