(c) State the tax consequences for both Glaikit Limited and Alasdair if he borro

(c) State the tax consequences for both Glaikit Limited and Alasdair if he borrows money from the company, as

proposed, on 1 January 2006. (3 marks)

(c) Alasdair is not employed, nor is he a director, of Glaikit Limited. As he holds 25% of the shares in Glaikit Limited, he is aparticipator in a close company and therefore the special close company provisions will apply. Thus Alsadair will be taxedunde