Urgent Investment Question

Hi my extension is due in 5 months and I invested around 60K (I only need to invest 50K) but after reading the older guidance and new guidance in the home office website I am bit confused/worried as the older one was pointing that investment should not sit in the account but need to actually spend it. I followed that to run the business and spend money on stock, rent for office, employees and other business expense. But the current guidance I cannot find that and only asking to provide bank statement showing the investment made on my name. Now I did actually spend money more than 50K which I think was fine according to the older guidance but with the new guidance if I invest 60K withdraw 15K for my personal use , will that be a problem ?

Please advice me

Hi
Did yo mean that you took 15K out of your business account for your personal use? if that's the case it definitely gonna give you issue as it will leave your total investment 45K even in a very straightforward case.

But I still spend more than 50K on stock, employees and other straight forward business expense, doesn't it count as investment ?

If you invested/spent more than 50k then you are fine as long as you have this in your accounts + the loan agreement.

Yes I did spend more than 50K here in uk for lease, stock, equipments, employees etc, the only thing was I withdrawn money from my business account for personal use from sales so it will show in my director's accounts that is my worry.

deepakjr123 wrote:Yes I did spend more than 50K here in uk for lease, stock, equipments, employees etc, the only thing was I withdrawn money from my business account for personal use from sales so it will show in my director's accounts that is my worry.

Then don't do it until you applied for extension to be safe.

Sorry please clarify what not to do ?

deepakjr123 wrote:Sorry please clarify what not to do ?

I meant you should not do it but I realised you took money out of your business. What are the conditions of your loan agreement particularly the period of the loan ?? You cannot take money out of your business unless you loan period is over and your company has no senior creditors or debt to pay off. That is the whole point of HO asking for a loan investment to be subordinated in favour of 3rd parties.

There is no particular condition for the the loan and it will be subordinated as per the visa requirement but need to draft a loan for my extension with the previous date

But still my question is what about the money spend here, isn't it an investment ? also how about the salary if I withdrew as salary, is that ok ?

I am really worried now

deepakjr123 wrote:There is no particular condition for the the loan and it will be subordinated as per the visa requirement but need to draft a loan for my extension with the previous date

But still my question is what about the money spend here, isn't it an investment ? also how about the salary if I withdrew as salary, is that ok ?

I am really worried now

Loan must have a period in which you cannot simply withdraw money but rules do not say how long this must be. I think HO cares less if the 50k is fully spent here. The loan subordination and no-security requirements mean that they simply want you to risk the money and get it back when your company has no debt or creditors.

Unlike loan repayment, salary is taxable. You are free to pay yourself salary as long as it comes from your profits not the 50k you invested.

I think I will put the money back as it is very confusing and adjust the account

My annual accounts submitted to the company house just show the money I invested under "other creditors" and accountant told me that is the legal requirement for submitting financial accounts. Would it be ok if create separate management accounts for the home office and put my name there ?

Please let me know

I am about to submit my extension application in few weeks and I did see some of the post here before mentioning signing the documents, would someone please advice me which documents (evidence ) should I sign myself as I cannot find any info regarding this from the guidance.

Please let me know

deepakjr123 wrote:My annual accounts submitted to the company house just show the money I invested under "other creditors" and accountant told me that is the legal requirement for submitting financial accounts. Would it be ok if create separate management accounts for the home office and put my name there ?

Please let me know

Accounts sent to companies house are not relevant to HO. send the full accounts showing your name (usually appears in notes section)

deepakjr123 wrote:I am about to submit my extension application in few weeks and I did see some of the post here before mentioning signing the documents, would someone please advice me which documents (evidence ) should I sign myself as I cannot find any info regarding this from the guidance.

Please let me know

You need to sign your accounts report, balance sheet, FPS and P11 reports as correct.

Hi thanks for your reply, would you please clarify what is accounts report ? is that same as the compilation report

Also is p11 a must or FPS is enough as my accountant gave me FPS because I requested FPS based on the guidance where they only asking FPS

I appreciate your help

deepakjr123 wrote:Hi thanks for your reply, would you please clarify what is accounts report ? is that same as the compilation report

Also is p11 a must or FPS is enough as my accountant gave me FPS because I requested FPS based on the guidance where they only asking FPS

I appreciate your help

Your accounts usually have Directors report and compilation report.
I also suggest you send both FPS and P11 for all employees you're claiming