mclarens 49mil fine for cheating is tax deductable

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Harvey
Harvey
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Joined: 16 Sep 2010, 14:18
Location: London Village

Re: mclarens 49mil fine for cheating is tax deductable

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Just_a_fan wrote:
bhallg2k wrote:The motivation behind the FIA's penalty is immaterial here, as are the alleged transgressions of other teams. I think what matters is the fact that the U.K. has pretty much subsidized McLaren's penalty with taxpayer money.
The motivation is not immaterial at all. If Max hadn't taken "$5million for the offense and $95million for Ron being a twat" (I think that was the quote) then McLaren probably wouldn't have bothered to do this. $5million would have been paid and forgotten about.

As a UK taxpayer, I don't mind helping out McLaren actually. They're a biggish employer and add a great deal to the economy by exporting (hopefully) lots of expensive sports cars. I'd rather spend a few million on them than tens (hundreds?) of billions wasted sorting out the banking crisis (started by our cousins across the pond) and the stupid wars in Iraq and Afghanistan (thanks again cousins) that have/are killing our troops just to keep some politicians feeling good about themselves (looking at you Mr Blair and your US neocon chums).

There are people hereabouts who are moaning about this not because they care about the British taxpayer but because they hate McLaren/Ron Dennis. Time to move on people, move on...
Except, as a UK taxpayer, you (or I) aren't subsidising McLaren through this action at all. This 49mil would've been spent elsewhere in their business, so would've always been a tax deductible expenditure. We haven't lost that tax burden, because it never existed.

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There seems to be an unnecessary amount of hatred towards McLaren over this decision. Seemingly due to Ron's reputation of being a bit ruthless or cold. So I have a quick question: if it had come out that McLaren had spent 50mil on a windtunnel, which would be a rather obvious business expense, would you be raving over the lack of tax being paid on that 50mil...?

Richard
Richard
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Joined: 15 Apr 2009, 14:41
Location: UK

Re: mclarens 49mil fine for cheating is tax deductable

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It's simply an exceptional business cost deducted from the bottom line before tax in their accounts.

This is meant to be a technical forum and this is very elementary accountancy.