Can I backdate income and expenses when forming a limited company?

[ASB]

BIM46351 - Specific deductions: pre-trading expenditure: scope

Make of it and the related guidance what you will.

[chopper]

1) Of course you cannot back date expenses incurred prior to company formation. Instead you reclaim tax relief on those expenses through your SA return.

2) Whilst you can reclaim expenses related to company formation, you cannot get CT relief on these expenses. (But you wouldn't pay personal tax on them anyway).
2a) A lot of accountants do free company formation as part of their packages. So therefore your CF expense is 'zero' (of course, that just means it is rolled up into your accountancy fees).

[Yonmons]

Expenses related to the setup of the company can. Paying for company formation, kit etc.

My accountant refused to allow me to claim this on the formation of my LTD CO, bounced the claim and invoices right back at me. It didnt take me long to dump him, and move on to another. But he was quite adament I couldnt claim it. So good luck to the OP with his request/idea. From the way I see it (and I am no expert) When you form a LTD CO, HMRC then contacts you and informs you of your accounting periods, not that HMRC are a suspicious organisation but I am sure they would have questions to ask if you wanted to back date the start date.

[northernladuk]

I am no accountant so one needs to clarify. But expenses for the company can be incurred before setup and claimed can they not?

Expenses related to the setup of the company can. Paying for company formation, kit etc.

[Underbase]

Income you received before the company was formed, for sales made before the company was formed can't have anything to do with the company. It can't make sales if it didn't exist. If you're a sole trader, then you continue to be a sole trader until the company is formed and you start trading through it. You can't change history.

I am no accountant so one needs to clarify. But expenses for the company can be incurred before setup and claimed can they not?

[philip@wellwoodhoyle]

Income you received before the company was formed, for sales made before the company was formed can't have anything to do with the company. It can't make sales if it didn't exist. If you're a sole trader, then you continue to be a sole trader until the company is formed and you start trading through it. You can't change history.

[northernladuk]

Good chance to test the knowledge of your new accountant I think

[TuesdayWeb]

I've been a sole trader since April 2014 and have now become a limited company (waiting for paperwork still). My question is, am I able to backdate any income/expenses for this financial year under the limited company?

Or do I need to make a clean-cut as to when I moved my business from being a sole trader, to setting up as a limited company?

My income has been smaller since April as I was only part-time, I've now decided to form a limited company as I'm full-time and I'm just trying to grasp whether this is the start, and only expenses and income from now on should be considered part of this new company. That would be a little annoying.