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MOD 720 Conversion Factor

Started by NAH, Wed 19 Jan 2022, 17:22

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NAH

With regards to our apartment block in the UK. It is run by a management company, all owners of apartments are immediately made members of the management company and the management company is run by four directors. Each director having to be an owner obviously.

I am one of the directors, which until moving to Tenerife was perfectly fine. One guy does all of the financial stuff (paying bills from the management company's bank account, preparation of annual budget, liaising with the accountant who audits our accounts and preparing the financial reports for the AGM etc)

I've just been asked if I would be willing to take control of these financial aspects, which in itself, physically, isn't an issue for me.

My concern is how would this affect my MOD 720 declaration (next year) if I took control of this as I would then be a single signatory for a large sum of money (all be it not my money) but I believe this would need to be declared? Maybe one for our accountant?
Never ride faster than your angel can fly.

Nova

Check with your accountant to be sure but I can't imagine why you would have to declare it if you don't have any ownership of the money.

Though is it practical your being a signatory if you're not physically there to sign?
If you are always trying to be normal, you will never know amazing.

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TOTO 99

Quote from: NAH on Tue 25 Jan 2022, 17:13
With regards to our apartment block in the UK. It is run by a management company, all owners of apartments are immediately made members of the management company and the management company is run by four directors. Each director having to be an owner obviously.

I am one of the directors, which until moving to Tenerife was perfectly fine. One guy does all of the financial stuff (paying bills from the management company's bank account, preparation of annual budget, liaising with the accountant who audits our accounts and preparing the financial reports for the AGM etc)

I've just been asked if I would be willing to take control of these financial aspects, which in itself, physically, isn't an issue for me.

My concern is how would this affect my MOD 720 declaration (next year) if I took control of this as I would then be a single signatory for a large sum of money (all be it not my money) but I believe this would need to be declared? Maybe one for our accountant?

I am also in the same position here in the UK. There's no renumeration no matter how much work goes into it. I've done it for 20 years and it's never been mentioned by the accountants who deal with my business.
I can't see any reason for you to mention it as you don't have any financial gain.  I don't see it as being any different to being the treasurer of the local boy scout group.
In the unlikely event that you come under any kind of scrutiny, you can easily prove your position.

Malteser Monkey

Quote from: TOTO 99 on Wed 26 Jan 2022, 07:28
I am also in the same position here in the UK. There's no renumeration no matter how much work goes into it. I've done it for 20 years and it's never been mentioned by the accountants who deal with my business.
I can't see any reason for you to mention it as you don't have any financial gain.  I don't see it as being any different to being the treasurer of the local boy scout group.
In the unlikely event that you come under any kind of scrutiny, you can easily prove your position.

renumeration ?

TOTO 99

Quote from: Malteser Monkey on Wed 26 Jan 2022, 08:55
renumeration ?

Lol....well spotted. I was trying to price a job at the same time as typing that.. :giggle: :giggle:

Just move the M and the N around and no one will know... :tiphat:

NAH

Quote from: TOTO 99 on Wed 26 Jan 2022, 07:28
I am also in the same position here in the UK. There's no renumeration no matter how much work goes into it. I've done it for 20 years and it's never been mentioned by the accountants who deal with my business.
I can't see any reason for you to mention it as you don't have any financial gain.  I don't see it as being any different to being the treasurer of the local boy scout group.
In the unlikely event that you come under any kind of scrutiny, you can easily prove your position.

Thanks @TOTO 99 I know it's not an issue in the UK, it's just the Spanish MOD720 declaration that I am a little worried about. Like you say there is no 'salary' or financial gain from it but since my name would be on the bank account of the management company I thought it may have to be declared on the MOD720.

I believe if you become an executor of a will and therefore have control over another sum of money / house you need to declare that on the MOD720.

Maybe I'm just being over cautious but I need to be sure before agreeing to do the thankless task and know whether to declare it before I get slammed with a huge fine for not declaring something on my MOD720.
Never ride faster than your angel can fly.

NAH

Quote from: Nova on Tue 25 Jan 2022, 23:53
Check with your accountant to be sure but I can't imagine why you would have to declare it if you don't have any ownership of the money.

Though is it practical your being a signatory if you're not physically there to sign?

Thanks @Nova I was wondering that as well but with everything being done online these days. Online banking to pay the bills, nothing actually needs 'signing' in person and any documents can be emailed, signed, scanned and emailed back again.

It does concern me that should anything out of the ordinary crop up I wouldn't be able to attend in person and would need to rely on one of the other directors sending me a photo  or something similar.
Never ride faster than your angel can fly.

TOTO 99


Apologies @NAH , I don't wish to derail your original thread but do any of your fellow directors live on site?

I'm just wondering are you not tempted to give the job to someone else? Or will nobody do it?

NAH

Quote from: TOTO 99 on Wed 26 Jan 2022, 10:27
Apologies @NAH , I don't wish to derail your original thread but do any of your fellow directors live on site?

I'm just wondering are you not tempted to give the job to someone else? Or will nobody do it?

It's all MOD720 related so no worries :)

One of the other directors lives on site but honestly he struggles to use email so the thought of him attempting to pay bills using online banking and produce financial reports using Excel terrifies me.
Never ride faster than your angel can fly.

TOTO 99

Quote from: NAH on Wed 26 Jan 2022, 11:08
It's all MOD720 related so no worries :)

One of the other directors lives on site but honestly he struggles to use email so the thought of him attempting to pay bills using online banking and produce financial reports using Excel terrifies me.

That's fair enough. I'm one of 3 directors and I'm the only one on site. The other two trust me to make the right decisions and I always involve them if there's anything expensive happening. Like the £3k I've just had to sanction for cutting back some trees. They asked me does it really need doing and I said yes. They are happy to take my word for it.
Being a real life contractor myself  means I know what to look out for. They appreciate that.

It needs trust when remote directors are involved. I think you will have to be happy that they are on site and trust them to make decisions. You stick to the finance side. It's all too easy to get dragged into doing more than is really necessary, as I'm sure you're fully aware. I know I am... :giggle: