Bounce Back Loan

Grumpy_chap

I just had a thought, and I doubt anyone here can answer beyond giving their opinion, but will winding up the Ltd Co definitely be the end of the BBLS?

The BBLS is not like a normal business loan, the residual of which would end once the company is no more, but the easy-access approach plus the rules on use of the funds mean it is quite different.

It seems entirely possible that HMRC / Government may pursue investigations long after people think these loans are passed.  There were many tales at the time of people claiming to abuse the system (new company - £50k BBLS - dividend - TESLA - close company).  If I were setting up a system to investigate incorrect loans, the first two criteria I'd be setting up would be:
1. Did the loan get repaid / are repayments continuing to plan?
2. Was the original amount advanced in line with the rules (max 25% turnover)?
Then investigating how the money was spent and whether any can be recovered, so if the money "should" still have been in the Ltd Co. when it was wound up, pursuing the Directors.

I'd imagine that any investigation would turn a blind eye to incorrect applications of the rules for any loans that have / are being repaid, but failure to repay would then be a trigger for further checks.

BBLS may well be a future "loan charge" type matter.

This is a general observation and not suggesting any wrong doing by the OP.

Jeremy535897

In this case, it would appear that the prior year reserves were held in non-cash assets, otherwise there would have been no need to take out a BBL to pay a dividend. That begs the question as to what happened to these assets, as it seems that they had disappeared by the time the company was wound up, otherwise they would have been realised to pay off at least part of the BBL..

sheramber

Grumpy_chap said:

I just had a thought, and I doubt anyone here can answer beyond giving their opinion, but will winding up the Ltd Co definitely be the end of the BBLS?

The BBLS is not like a normal business loan, the residual of which would end once the company is no more, but the easy-access approach plus the rules on use of the funds mean it is quite different.

It seems entirely possible that HMRC / Government may pursue investigations long after people think these loans are passed.  There were many tales at the time of people claiming to abuse the system (new company - £50k BBLS - dividend - TESLA - close company).  If I were setting up a system to investigate incorrect loans, the first two criteria I'd be setting up would be:
1. Did the loan get repaid / are repayments continuing to plan?
2. Was the original amount advanced in line with the rules (max 25% turnover)?
Then investigating how the money was spent and whether any can be recovered, so if the money "should" still have been in the Ltd Co. when it was wound up, pursuing the Directors.

I'd imagine that any investigation would turn a blind eye to incorrect applications of the rules for any loans that have / are being repaid, but failure to repay would then be a trigger for further checks.

BBLS may well be a future "loan charge" type matter.

This is a general observation and not suggesting any wrong doing by the OP.

You'll get several opinions if you use Google.

caprikid1

As a tax payer this saddens me, I feel like I have been robbed multiple times.

tifo

caprikid1 said:

As a tax payer this saddens me, I feel like I have been robbed multiple times.

By many people and organisations for many years, not only BBL