Incorporation flaws come to the surface at inconvenient times, for instance when you have a CQC inspection and you realise you should have notified the CQC that you have incorporated your business. Or when you decide to sell the practice and you realise there are investments in the business that are stuck in your Ltd Co. We have plenty of experience of rescuing dentists who have inadvertently got into difficulty because their advisor did not have the essential expertise for a dental incorporation.
In a new article this month in Private Dentistry we describe the things that can go wrong with incorporation. The Q&A article covers the difficulties that can occur, along with the warning that re-structuring the company following a flawed incorporation can be complex.
We also cover the issue of the Director’s Loan Account, another technical aspect of incorporation. When you sell the goodwill of the practice to the new company there will not be enough assets for the company to pay for it, so you create a director’s loan account. This is central to planning how you maximise profits and minimise tax.
However, as the Government website advises, you must keep a record of any money you borrow or pay into the company and ensure any loan is recorded on the balance sheet in your annual accounts. If you want to know more, don’t hesitate to make contact with us.
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