Ltd company online gambling transactions

[swanboy]

Hi,

I have a small Ltd company with me as the sole director that trades on ebay. i have been stupid in putting about 5 online gambling transactions to william hill through my business paypal account.

I'm now worried that this might be viewed by the powers that be as an illegal and improper way to run a ltd company and this might result in me banned as a director of a company?

Can you please advice me if it is illegal for a ltd company with one director to use some of it's money in gambling activities, and if my accounts are audited, will the inspector see these gambling transactions

Many thanks for the help

 

[fathippy]

This is only my opinion so dont use it as law, but as far as I can see there is nothing wrong with that. If you are the only shareholder you can do what you like (within reason) as long as you act in the best interests of any creditors (especially the taxman).

The only thing you could be accused of doing is spending money that you didnt have, ie if you then told HMRC you couldnt pay the tax bill, but even in that situation I would not see a flaw in arguing that it was a reasonable attempt to make money!

If it is only a bank account issue then account for those transactions as payments to a directors loan account and then they are your own problem to deal with.

As far as I am concerned, as long as you are not playing roulette, or anything else that is "clearly" frivolous, then it is arguable that "betting" is a sensible investment strategy. If Tottenham are playing a game to get into the champions league then there is little difference between backing them to win or buying their shares (when they existed), so I dont see there is anything to be ashamed about.

 

[swanboy]

thanks for the reply!

ok...that goes someway to putting my mind at rest...

I suppose my question is, how likely is it that my accountant will see these transactions on my paypal account. i remember when i had my first consultation with him that he said he'd need the monthly sales reports from paypal, but he didn't mention anything about details about individual transaction.

Likewise, in the event of an hmrc inspection, would the inspector be likely to see these transactions?

Thanks

 

[David Griffiths]

Charge the transactions to your director's loan account and there won't be the slightest issue with anybody. That presumes that the payments were private payments and you aren't claiming that they were company costs. If they are, then there will be no tax deduction for them.

The accountant will need more than the monthly summary of sales from Paypal. He'll need to know what's been paid out from it as well, including the Paypal fees, business payments and private payments.

 

[MyAccountantOnline]

How much were the amounts involved and do you have an overdrawn loan account with the company already?

 

[Blood Lust]

Hi,

I have a small Ltd company with me as the sole director that trades on ebay. i have been stupid in putting about 5 online gambling transactions to william hill through my business paypal account.

I'm now worried that this might be viewed by the powers that be as an illegal and improper way to run a ltd company and this might result in me banned as a director of a company?

Can you please advice me if it is illegal for a ltd company with one director to use some of it's money in gambling activities, and if my accounts are audited, will the inspector see these gambling transactions

Many thanks for the help

You havent done anything illegal.

As the director you are entitled to take wages from the business. If they havent been removed as wages first to your bank account and then spent on gambling its defined as drawings.

All you need is a drawings account which lists your gambling invoices or transactions copied from your bank statement.

There is no issue here.