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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
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I have set up a new community interest company to which

Resolved Question:

hi,
I have set up a new community interest company to which i made an interest free loan of £5000 to. I would like to know if this is included in my turnover for my annual accounts. Any help well be gratefully received.
kind regards
Simon
Submitted: 1 year ago.
Category: Tax
Expert:  taxadvisor.uk replied 1 year ago.
Hello and welcome to the site. Thank you for your question.

Loans are not turnover. You don't include any loans made as part of your turnover..
They sit within the balance sheet.

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.
Customer: replied 1 year ago.

thanks very much but with that in mind, where in the balance sheet will it sit then. also we received a start-up grant which does not need to be repaid, where would that sit?

Expert:  taxadvisor.uk replied 1 year ago.
Simon, thank you for your reply.

A loan is a debtor in your books until such time as it is repaid in full... just like if you borrowed money the loan would be a creditor in your balance sheet and would reduce as you repay it.

You have also asked a supplementary question unrelated to your original question.
A grant is income as it would be funding some costs whether revenue or capital. Capital grants would reduce the cost of asset and revenue grant would reduce operating costs.

I hope this is helpful and answers your question
Customer: replied 1 year ago.

just with regard to the first question, the company owes the money to me personally, does that not make the companythe debtor and i am the creditor?

Expert:  taxadvisor.uk replied 1 year ago.

Simon, thank you for your reply...

Just to clarify the position ..
The person owing the money is a debtor and the person who is owed the money is the creditor.

If you are doing company accounts then the company will show you as a creditor in its books.

Entries in the company's books would have been

Debit - Cash at bank (current assets)

Credit - Loan account (creditor)

I hope this is helpful.

taxadvisor.uk, Chartered Certified Accountant
Category: Tax
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Experience: FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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