It's pretty meaningless

As is typical with US acquisitions of UK entities a new Holding company will have been set up financed with debt. A check the box election is made for US tax purposes which means that in the US the UK company is treated as being part of the US company. Hence for US purposes the loan is disregarded.

For UK tax purposes the loan interest is an allowable deduction if paid within 12 months of the year end. Hence, the US owners get UK tax relief on the acquistion of Manure with no pick up of the receivable in the US. Simples

Posted By: Butterworth on May 17th 2012 at 15:27:00

Message Thread

?258,909...average amount of interest paid per day by Manure over last 9 months (Other Football) - Tony Martin, May 17, 14:56:48
- It's pretty meaningless (Other Football) - Butterworth, May 17, 15:27:00
  - No they don't - avoidance involving arbitrage would deny them the deduction in the UK (n/m) (Other Football) - SimonOTBC, May 17, 16:09:48
    - No it wouldn't (Other Football) - Butterworth, May 17, 16:56:39
      - Besides what they have probably done (Other Football) - Butterworth, May 17, 17:02:28
        
        I agree with that - just not sure it could be done as simply as you first suggested (Other Football) - SimonOTBC, May 17, 17:10:27
        
        Delaware LLC (Other Football) - Butterworth, May 17, 22:50:25
        
        Now replaced by something in CTA 2009 (Other Football) - Butterworth, May 17, 23:31:45

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