Sole Trader Closing inventory

[Billett]

Hi All,

I run as a sole trader and last year setup a limited company. I sold various amounts of stock over to the limited company throughout the year, but have some stock that I kept as a sole trader. I'm looking at closing my sole trader side, what is best to do with the stock when I close it?

Thanks

 

[japancool]

Sell it to the limited company. Or flog it on ebay.

 

[MBE2017]

Sell it?

 

[Billett]

If I sell it to the limited company I'm still stuck with it. It's old stock I haven't been able to sell taking up room. Can I write it off as a sole trader (doing cash basis accounts) and take the hit as a loss?

 

[Scalloway]

If you use cash basis then the cost will have already gone through your accounts.

 

[MBE2017]

If I sell it to the limited company I'm still stuck with it. It's old stock I haven't been able to sell taking up room. Can I write it off as a sole trader (doing cash basis accounts) and take the hit as a loss?

You can sell it to someone else.

 

[Billett]

You can sell it to someone else.

Yes, I mean more as I loss of money to me personally.

 

[MrGerbil]

Yes, you can sell it personally. Whatever you get for it should form part of the turnover in your final period's accounts, and the cost of the stock can be written off there too, though if you are using the cash basis that will already have happened.

 

[Billett]

Yes, you can sell it personally. Whatever you get for it should form part of the turnover in your final period's accounts, and the cost of the stock can be written off there too, though if you are using the cash basis that will already have happened.

Thanks. But what if I can sell it before I close the business? This is what I'm really getting at here. I have expensed it in terms of the cash basis accounting, but anything left at the point of closure. What happens to it then, can I dispose of it or do I need to do anything special.

 

[MrGerbil]

Thanks. But what if I can sell it before I close the business? This is what I'm really getting at here. I have expensed it in terms of the cash basis accounting, but anything left at the point of closure. What happens to it then, can I dispose of it or do I need to do anything special.

If you can sell it, fine. The sales receipts become part of your turnover. Did you mean to write "can't" rather than "can"? If so, treat your sole trader business as continuing for tax purposes until you sell, scrap, or give away the stock.

 

[Billett]

If you can sell it, fine. The sales receipts become part of your turnover. Did you mean to write "can't" rather than "can"? If so, treat your sole trader business as continuing for tax purposes until you sell, scrap, or give away the stock.

Sorry yes I did mean can't. I did edit it but maybe not in time.

Ok so I can just scrap or give it away

 

[MrGerbil]

Sorry yes I did mean can't. I did edit it but maybe not in time.

Ok so I can just scrap or give it away

Yes.