dave2
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Post by dave2 on Aug 28, 2023 18:50:53 GMT
I think that, on AC's view, the amounts put into recovery are not declared losses but amounts that taxpayers may optionally treat as losses. Hence they are excluded from their report to HMRC. To be consistent with this, I expect that when AC eventually get round to writing loans off they will deduct the write offs in their calculation of net income. I think they would have to. As somebody who was non-UK tax resident prior to the 2020-21 tax year there is no way for me to start using the AC loans in recovery figures, nor would I want to. They use the loosest interpretation of SAIM 12140 and Treat loans as being irrecoverable even whilst they are in recovery. I have written my own personal guidelines as to how I will be handling the write-offs and will print a copy of these rules to save with each years tax calculations. This is in case of any HMRC dispute. Firstly, at what point does a loan become irrecoverable? 1. At AC "default" time whilst capital recovery is still ongoing, 2. At the start of legal process, 3. When AC notes it as being irrecoverable in the loan notes, 4. When AC moves it to the new irrecoverable loans section? My guidelines: - Anything that went into AC default status whilst I was non-resident cannot be written off against interest, even if recovery was ongoing at the time. - I will not claim whilst recovery of defaulted capital is still possible. - I cannot claim where there is an "agreed settlement" made. - I will claim once AC declares a loan as being considered irrecoverable in the loan updates. - I will use my own judgement as to whether I treat a loan as irrecoverable if it gets stuck in legal process. - I will write off the loans within 4 years of the AC default date. - I will explain in my notes why I am claiming each loan as irrecoverable.
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rscal
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Post by rscal on Sept 20, 2023 11:15:51 GMT
May I check: what is the time-point for recording loss on a loan subject to a 'full and final' settlement Lenders agree to (i.e. once recovery is automatically capped - and thus a loss crystallized) but before any F&F amount is realised? Hopefully this happens within the same FY but you can't rely on that.
To give a current example: #1226 will ultimately realise 93% of capital (so a 7% loss already) but completion is pending so we haven't had any of this money.
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dave2
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Post by dave2 on Sept 20, 2023 17:53:35 GMT
May I check: what is the time-point for recording loss on a loan subject to a 'full and final' settlement Lenders agree to (i.e. once recovery is automatically capped - and thus a loss crystallized) but before any F&F amount is realised? Hopefully this happens within the same FY but you can't rely on that. To give a current example: #1226 will ultimately realise 93% of capital (so a 7% loss already) but completion is pending so we haven't had any of this money. My understanding is that no loss can be offset against tax if a settlement with the borrower is agreed to as this constitutes an accepted re-pricing.
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rscal
Posts: 923
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Post by rscal on Sept 20, 2023 18:20:56 GMT
May I check: what is the time-point for recording loss on a loan subject to a 'full and final' settlement Lenders agree to (i.e. once recovery is automatically capped - and thus a loss crystallized) but before any F&F amount is realised? Hopefully this happens within the same FY but you can't rely on that. To give a current example: #1226 will ultimately realise 93% of capital (so a 7% loss already) but completion is pending so we haven't had any of this money. My understanding is that no loss can be offset against tax if a settlement with the borrower is agreed to as this constitutes an accepted re-pricing. Something to do with the loss remaining an 'acknowledged debt'? When a recovery ceases the debt remains 'acknowledged' I suppose but a party is no longer seeking to pursue. [That does not seem helpful, but I suppose tax isn't there to 'help' anyone - it is a punishment for thrift and non-dependency]
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ilmoro
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'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Sept 20, 2023 18:47:49 GMT
My understanding is that no loss can be offset against tax if a settlement with the borrower is agreed to as this constitutes an accepted re-pricing. Something to do with the loss remaining an 'acknowledged debt'? When a recovery ceases the debt remains 'acknowledged' I suppose but a party is no longer seeking to pursue. [That does not seem helpful, but I suppose tax isn't there to 'help' anyone - it is a punishment for thrift and non-dependency] Given the previous history of this loan, one of the people involved and history of other loans I wouldnt be basing anything on predicted losses ... this could still go into formal recovery triggering full loss relief.
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littleoldlady
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Running down all platforms due to age
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Post by littleoldlady on Oct 28, 2023 11:28:48 GMT
Slightly off topic but the Account statement only has transactions back to Dec 2018. Anyone else confirm this?
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dave2
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Post by dave2 on Oct 28, 2023 13:34:45 GMT
Slightly off topic but the Account statement only has transactions back to Dec 2018. Anyone else confirm this? My MLIA and cash account statements have transactions back to when they were opened in 2016.
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