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Sam, Accountant
Category: Tax
Satisfied Customers: 7519
Experience:  26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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My small family company sold its business in November 2010

Customer Question

My small family company sold its business in November 2010 and Purchase Price was to depend on the income the Purchaser actually received from our ex-clients over a subsequent 2-year period to November 2012.
Our Accountant advised we had to enter the Notional Purchase Price in our 2010 accounts (a figure based on a multiplier of 3 times the previous year's income and therefore an estimate). We paid Corporation Tax on Assumed Purchase Price of £155,000 odd.
The following 3 years recorded losses for our company - there was no income, only running costs of keeping in existence pending final settlement from Purchaser.
Our Accountant advised us that we could, if the final sum was less than the Notional sum on which we were taxed, recover the excess Corporation Tax.
He now advises that this is wrong, and that although we were in fact only paid £135,000 in total, we cannot recover the CT on the £20,000 we did not receive.
He also advises we cannot offset losses of 2012 (we have already offset 2011) against the income of 2010, which seems in contravention of the Terminal Losses 3-year rule.
Can you please adavise on the 2 situations - a) whether we can recover CT on payment not received, and b) whether we can recover 2012 losses against 2010 (the last year we received any income).
Thank you!
Submitted: 4 years ago.
Category: Tax