selling personal assests to LTD co

[frenchparts]

Hi there

just another quick one

i have a lot of previous stock from when i was a sole trader, and also all my tools etc and also some personal things, laptop etc that id like to put in the LTD co as assets all paid for by myself

how can i "sell" these to my LTD co? obv i wont be taking the money out i just want the assets in the LTD name


Many thanks

 

[Yorkshire&Online]

You will effectively be selling the assets to the company at the appropriate value.

So if you don't actually pay anything for them, the value should be allocated to your Director's Loan Account.

Eg:

DEBIT Stocks
CREDIT Directors Loan Account

The company now owes you the money which you may pay yourself back when you are ready to.

There is more info about incorporating your business on my website:

http://www.brown-royd.co.uk/resources-business/incorporating-an-existing-business---going-limited

I recommend you talk things through with your accountant (if you have one) to do things in the best way. There are also rules concerning Capital Alowances on incorporation you should be aware of.

 

[frenchparts]

Many thanks for your reply

just looking on your website now, you are actually based in the same town as my business, you could be hearing more from me shortly,i have "liked" your Facebook page

cheers

 

[Yorkshire&Online]

What a coincidence! And thanks for the like, I will have a look.

The homepage of the website is actually not working properly this morning. Techies are looking into it!

Feel free to get in touch anytime.

 

[JohnJones]

I have done this with my LTD Company, but I have included a 'stock' value and an 'asset' value in the opening balances (using freeagent)

I'm not sure if I have done the right thing, but my year end is almost due, do I need to add a closing 'stock' value for stock I have left

Bear in mind I haven't used the stock option in freeagent as I found it too confusing

 

[Scalloway]

If you have stock on hand at the end of the financial year you should deduct from your cost of goods sold and add it as an asset on the balance sheet.

 

[JohnJones]

If you have stock on hand at the end of the financial year you should deduct from your cost of goods sold and add it as an asset on the balance sheet.

Thats the part I don't understand

I will definitely have stock on hand at the end of the financial year

For example

I put in 10k as an opening balance of stock (I keep an excel spreadsheet of that actual items and breakdown of quantities and values, this makes it easier to amend ongoing so I have a live stock quantity and value)

So at the end of the financial year I have 8k stock left, this is the figure I don't know what to do with, or rather where I put it within freeagent

It means I have sold 2k of stock, would this become 'cost of sales' and then the remaining 8k of stock become an asset?

If so would this be a journal entry to balance the books?

All very confusing

 

[Scalloway]

So at the end of the financial year I have 8k stock left, this is the figure I don't know what to do with, or rather where I put it within freeagent

It means I have sold 2k of stock, would this become 'cost of sales' and then the remaining 8k of stock become an asset?

If so would this be a journal entry to balance the books?

I am not familiar with freeagent but that is how most accounting systems would do it if you aren't using the stock system.

 

[JohnJones]

I am not familiar with freeagent but that is how most accounting systems would do it if you aren't using the stock system.

Thanks

Its all the terminology and which bits go in which parts that confuses me, but I am learning all the time