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Readers' Forum
Replies to Queries — 1
Corporate contribution
Readers' Forum
Replies to Queries — 1
Corporate contribution
A director trades from home and is to build an extension for £25,000, a third of which would be used as an office for his limited company. He is to personally finance the whole project on a re-mortgage. To reclaim a portion of the VAT, the builder will raise an invoice for £8,000 plus VAT for the limited company element and the company would pay this direct, effectively including it as a balance sheet asset. Would this cause any benefit in kind problems for the director or capital gains problems on a subsequent house sale (the office area would be approximately one-tenth of the whole house) and would the VAT recovery be successful?
Readers' advice is welcomed.
(Query T16,460)
