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Tax credits locked in company - can i use it?

Discussion in 'Accounting & Tax' started by Bran, 28th Jul, 2016.

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  1. Bran

    Bran Well-Known Member

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    My father has a company with 180k of tax credits within it, that he doesn't seem to have any means to access.

    Is there a way we might access these? As far as I know, the company has just sat dormant for a long time

    I thought perhaps we could lend the company money, for it to start buying shares, but tbh, I have no idea.
     
  2. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Do you mean franking credits?

    Who is the shareholder?
     
  3. Bran

    Bran Well-Known Member

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    I think I mean trapped losses, to the tune of 180k. I will ask him to clarify and get me the deeds, depending how willing he is to hand it over. But if I can somehow become involved and make use of a positive investment within it.

    Obviously lots more to explore with it. He no longer earns much of a taxable income, so will never be able to offset the previous loss.

    I'm sorry if I'm confusing terms
     
  4. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Oh, losses. There are various rules designed to prevent the trading in losses. They may not be available to be carried forward where ownership changes, but it could be possible in some situations.

    That company could also be the beneficiary of a discretionary trust and that might be another way to benefit.
     
  5. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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    Also Part IVA may pose a concern.
     
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