Retail Partnership closure - stock

Discussion in 'Accounts & Finance' started by Daxydoggie, Feb 13, 2020.

  1. Daxydoggie

    Daxydoggie UKBF Newcomer Free Member

    11 0
    Hello all,
    We have a small retail partnership non vat regd, accrual accounted, and depending on personal circumstances, we may have to end it later on this year.
    The business is profitable and solvent, and all taxes paid on time, and we will probably be left with about £8k of stock in the end.
    How is this accounted for, its it ours? do we need to purchase it ourselves, can we write it off/give it away, or sell it for a pepercorn, just confused as to how it will be shown on final year return on cogs opening+purchases-closing? confused. please help!
     
    Posted: Feb 13, 2020 By: Daxydoggie Member since: Jan 13, 2019
    #1
  2. Scalloway

    Scalloway UKBF Legend Free Member

    15,684 3,313
    The stock on hand at the end of your final set of accounts will be deducted from cost of good sold. When you divi up the assets of business at the end of the partnership then it is yours to deal with as you wish.

    If the partnership sells the assets then you will need to keep the books open to account for it. If you dump it or take it for your own use there is no further action needed. If you decide to sell it on a personal basis you will need to report it on your self assessment.
     
    Posted: Feb 13, 2020 By: Scalloway Member since: Jun 6, 2010
    #2
  3. Daxydoggie

    Daxydoggie UKBF Newcomer Free Member

    11 0
    Thank you for the reply. So the stock remaining is just simply part of the normal cogs formula, it is simply the closing stock value? Or is it shown elsewhere on the return?
     
    Posted: Feb 13, 2020 By: Daxydoggie Member since: Jan 13, 2019
    #3
  4. Scalloway

    Scalloway UKBF Legend Free Member

    15,684 3,313
    Yes. As a partnership you and your partner are one and the same as the business. So any, fixed asssets, stock, bank balance fall to you when the partnership closes. You work out what share of partnership assets each partner is due and divide up the remaining assets and cash to clear it.

    If you include a Balance Sheet on your partnership self assessment You can transfer all assets to drawings to clear the partnership accounts.
     
    Posted: Feb 14, 2020 By: Scalloway Member since: Jun 6, 2010
    #4