CT600 Box 250: Management Expenses
Box 250 on the CT600 is for management expenses of investment companies. This is a specific relief for companies whose business is managing investments rather than trading.
What Goes in Box 250?
Box 250 captures expenses incurred in managing an investment business. This applies to:
- Pure investment holding companies
- Property investment companies (in some cases)
- Companies managing share portfolios
- Holding companies for group investments
Understanding Management Expenses
What Are Management Expenses?
Management expenses are costs of running an investment company:
- Administration costs
- Professional fees for investment advice
- Accountancy fees for investment portfolios
- Bank charges related to investments
- Custodian fees
- Investment research costs
Trading Company vs Investment Company
| Company Type | Expense Treatment |
|---|---|
| Trading | Expenses deducted from trading profits |
| Investment | Management expenses relief (Box 250) |
Qualifying for Management Expense Relief
Investment Company Definition
Your company qualifies if it:
- Has investment income as its main activity
- Doesn't carry on a trade
- Manages investments for profit
Examples of Investment Companies
| Type | Qualifies? |
|---|---|
| Share portfolio company | Yes |
| Pure property holding | Possibly |
| Trading company | No |
| Dormant holding company | Possibly |
Types of Management Expenses
Qualifying Expenses
| Expense | Deductible? |
|---|---|
| Directors' fees (investment duties) | Yes |
| Investment manager fees | Yes |
| Accounting fees (investment related) | Yes |
| Audit fees | Yes |
| Bank charges | Yes |
| Office costs (proportion) | Yes |
| Legal fees (investment related) | Yes |
Non-Qualifying Expenses
| Expense | Deductible? |
|---|---|
| Capital expenses | No |
| Costs of acquiring investments | No |
| Non-business expenses | No |
| Costs related to capital gains | No |
Calculating Box 250
Step-by-Step
- Identify if you're an investment company
- Total all management expenses
- Deduct any disallowable items
- Enter the allowable amount in Box 250
Example Calculation
| Expense | Amount |
|---|---|
| Director fees (investment duties) | £12,000 |
| Investment adviser fees | £3,000 |
| Accountancy fees | £2,500 |
| Bank charges | £300 |
| Office costs (50% allocation) | £1,200 |
| Total management expenses | £19,000 |
How Management Expenses Work
Current Year Set-Off
Management expenses are set against total profits:
``` Total profits (before Box 250) £50,000 Less: Management expenses (£19,000) Total profits (Box 235) £31,000 ```
Excess Expenses
If management expenses exceed income:
- The excess carries forward
- Can be used in future profitable years
- No time limit on carry forward
Management Expenses vs Trading Expenses
Key Differences
| Aspect | Trading Expenses | Management Expenses |
|---|---|---|
| Claimed via | Box 155/160 | Box 250 |
| Company type | Trading | Investment |
| Set against | Trading profits | Total profits |
| Carry forward | As trading loss | As management expenses |
Property Companies and Management Expenses
When Property = Investment
Property companies may have:
- Property income (Box 190)
- Plus management expenses (Box 250)
Example
| Item | Treatment |
|---|---|
| Letting agent fees | Property expense (against Box 190) |
| Director time managing portfolio | Management expense (Box 250) |
| Property repairs | Property expense |
| Investment advisor fees | Management expense (Box 250) |
Related Boxes
| Box | Description |
|---|---|
| 245 | UK property business losses |
| 250 | Management expenses (this box) |
| 255 | Charitable donations |
| 260 | Group relief claimed |
| 235 | Total profits after deductions |
Common Questions
My company is a trading company - can I use Box 250?
No. Trading companies deduct expenses against trading profits (Box 155/160). Box 250 is only for investment companies.
We have both trading and investment income - which applies?
If your company is primarily a trading company, use trading expense rules. If primarily an investment company with some trading, you may have both deductions. Seek advice for mixed activities.
What about holding companies?
Pure holding companies (holding shares in subsidiaries) may qualify for management expenses relief. The expenses of managing the shareholdings can go in Box 250.
Are directors' fees always management expenses?
Only if the director is spending time on investment management activities. If they're running a trade, those fees are trading expenses instead.
When Using TinyTax
TinyTax is designed for trading companies:
- Most TinyTax users won't have management expenses
- Trading expenses are handled through the normal expense sections
- If you're an investment company, you may need specialist software or advice
Related Articles
- CT600 Box 245: Property Business Losses
- CT600 Box 235: Total Profits
- CT600 for Property Companies
- CT600 Boxes Explained
Need Help?
TinyTax handles standard trading company scenarios. For investment company management expenses, consider consulting a tax specialist who understands investment company taxation.
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