P
PCooper
New Member
Hello, I'm starting a small business and have a friend who is going to invest half while I run it.
I've created a company with 100 ordinary shares at £1 each. She will get 50% of the shares once the money is paid into the business account.
It's to be used for stock and running costs including paying myself £1000 a month until the company makes some money.
Can anybody please advise how the £7500 investment will be accounted for? Somebody said it's best as a director loan, but she doesn't particularly want to be a director if it can be helped. I was also told that if I 'sell' her the shares then there may be Capital Gains Tax to pay as I'm selling £25 of shares for £7500?
Is this the usual process and are there any other ways of accounting for this?
TIA
I've created a company with 100 ordinary shares at £1 each. She will get 50% of the shares once the money is paid into the business account.
It's to be used for stock and running costs including paying myself £1000 a month until the company makes some money.
Can anybody please advise how the £7500 investment will be accounted for? Somebody said it's best as a director loan, but she doesn't particularly want to be a director if it can be helped. I was also told that if I 'sell' her the shares then there may be Capital Gains Tax to pay as I'm selling £25 of shares for £7500?
Is this the usual process and are there any other ways of accounting for this?
TIA
