WHEN ONE STARTS A BUSINESS, A LTD COMPANY, IS START UP CAPITAL, A LUMP SUM, TAXED AS INCOME?

I am formulation to begin the Ltd Company, as well as I devise to put the estimable volume of assets in to it, as primary capital. Would this be see by the taxman, as income entrance in to the business, as well as so be taxed?

{ 3 comments… read them below or add one }

Fantasiesbymel September 9, 2010 at 5:19 am

I did the same thing in an LLC (Fairy Arts LLC) and yes I had to report it.

truecockney September 9, 2010 at 5:26 am

Start-up capital is not taxable. This should be shown on the balance sheet.

Debit: Bank
Credit: Share Capital

Only a profit is taxable.

Russ September 9, 2010 at 6:24 am

Any money put into a company by shareholders is considered as capital and therefore not subject to tax, however, when this money is withdrawn, e.g. sales of shares, a potential capital gains tax situation arises

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