New Trade in Limited Company

HcksawJimDuggan

If a trade is transferred to a limited company that previously carried on a trade of a different nature, is it still possible for the director to extract funds from the company through his directors account that was built up in the old trade.

The same person is the director in the old trade & the new trade.

I know that losses forward are lost in a company if the nature of the trade is changed but can't find anything on directors current account.

Alan Shore

You need to be more specific. Company A conducts a trade and the director is owed money by co A.

The trade is transferred to Co B, has co A paid CGT, is it part of a group? Has Co B paid Co A for the trade?

HcksawJimDuggan

Sorry, was thinking my first post was confusing when I read it out myself.

Company A conducts a trade and the director is owed money by co A. The trade ceases but the company is not struck off. A couple of years later Company A takes on a trade that is different in nature to the original trade. Can the director extract funds from the company through the directors current account that was built up in the original trade?

Alan Shore

The amount is owed by the company to the director if the company generates profits pays Corporation Tax (losses forward not allowed against new trade) and has some money left to pay the director no issues.

I think you are over thinking this there is anti avoidance where a company is sold.