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Hi Colleagues
Can anyone help with how can one justify a members' loan liability in a way that may not jeopardise the member. There was a loan of about R2.6million raised by the previous accountant, and it seems as if she/he or she was trying to balance figures as there was income not declared for VAT purposes and the CC got Audited and the Audit was specifically on a JV project, and they never picked up some other Incomes which were received in a different bank account. Now the CC is trying to apply for a compromise as it was charged Millions by the tax man, as a result of that Audit. But now there is this figure that is siting as members loans Liability that the tax man wants to know where did the member get such money and where was it disclosed on his personal taxes.
The truth is that this amount was some form of a escape goat. Please advise how can this be justified in a way that will have minimum tax impact to the member?
Can anyone help with how can one justify a members' loan liability in a way that may not jeopardise the member. There was a loan of about R2.6million raised by the previous accountant, and it seems as if she/he or she was trying to balance figures as there was income not declared for VAT purposes and the CC got Audited and the Audit was specifically on a JV project, and they never picked up some other Incomes which were received in a different bank account. Now the CC is trying to apply for a compromise as it was charged Millions by the tax man, as a result of that Audit. But now there is this figure that is siting as members loans Liability that the tax man wants to know where did the member get such money and where was it disclosed on his personal taxes.
The truth is that this amount was some form of a escape goat. Please advise how can this be justified in a way that will have minimum tax impact to the member?
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