What comes first: Form company and then spend? or vice versa?

[BusinessRookie]

Hi,

I am planning a start up company as a ltd (well researched and certain of this legal entity). There are various items that I need to purchase in order to move closer to start up and I wondered if, for tax reasons, I should incorporate the company first and then keep receipts? Or if things I purchase before the incorporation could be counted towards allowable deductions if they demonstrate that they are for business purposes?

Would I be best making a directors loan to the business first?

Thanks for your help peope :)

[GillespieBS]

I don't see why you shouldn't buy now and then introduce them to the business and create a directors current account/loan account. Keep the receipts for the business records and if you want the business to refund you, draw it back out when the business has some cash.

[Batra Ventures UK Limited]

Expenses shouldnt make the case different either ways. However if you form company there are extra formalities/paper work to be completed time to time during which you may not be trading and will have to pay for a professionals fee.

[KM-Tiger]

Or if things I purchase before the incorporation could be counted towards allowable deductions if they demonstrate that they are for business purposes?

No problem provided it's legitimate.

But slipping your new fitted kitchen through as 'office furniture' would be stretching it a bit!

[Before the high horses charge me down, that second comment was a joke!]

[BusinessRookie]

Thanks for the advice. I was just weary of starting to pay for things without having actually formed the company yet. I doubt I'd get away with that fitted kitchen though... :)