Also posted thread in Money Matters.
Hi there,
I will make this as brief as possible.
My Dsis and BIL own a Restaurant/Pub/B&B. They also own a restaurant and three flats which are all leased/rented out. Each month these additional properties bring in around £2k which is put straight into their current business. With this additional £2k their business just about breaks even.
Because of the financial situation, neither Dsis or BIL take a salary, therefore they claim tax credits.
The tax credits help feed and clothe their 3 DCs aswell as going towards their household utility bills. The tax credits are the only income that they have.
Their Accountant has (for some reason) put the rent from the properties down as profit in the tax return instead of off-setting it against the current business (as I said, they see none of this £2k, it goes straight into their current business to keep it afloat) and now the tax office are asking them to repay over £10ks worth of CTC.
My sister is in a really bad way and has no way of getting the money.
My Dad thinks her Accountant has made a massive mistake and they are going to see his Accountant a week on Friday (earliest appointment they could get).
In the meantime, does anyone know what the reality might be? Has their Accountant screwed up?
They have tried to sell their current business, but no-one is buying pubs/restaurants at the moment, understandably.
Thank you in advance.