Hello,
I run a one-man limited management consultancy company. I don't draw salary, preferring to leave cash in the company.
If the company invests, say, £5,000 in a unit trust and at the end of the accounting year the units are worth £6,000 (ever the optimist!):
a) in the accounts must I show the value as £6,000 or can I show the value as the original £5,000 cost?
b) if I must show £6,000 does this mean I must pay corporation tax on the £1,000 unrealised gain?(Company profit will exceed the £10K threshold.)
c) ideally I'd pay no tax on unrealised gains, then realise the gains in a year when profits, including the gains, were below £10K and thereby avoid tax on the gain altogether. Or am I living in cloud cookoo land?
d) maybe there are other options I haven't thought of...?
Mike
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