Reply to: First year accounts - bringing in assets

[TheGreenBastard]

Oh, we're talking like 4 years of work on the side prior to incorporating, whilst I was still permie.

[Pondlife]

Is it frowned upon to bring in assets / expenses in the first year of accounts? I have a lot of domains, hosting costs, office costs that pre-date the incorporation of my Ltd.

I know technically it's possible and assume as long as all is above board there should be no harm done - I just wonder if it could increases the chances of investigation (probably not something folk here can answer). I suspect my "profits" would be severely dampened by bringing them in.

Incorporated 2014; it is/was a software company, which goes hand in hand with software consultancy - I just assume my contracting is an extension of the businesses activities.

[TheGreenBastard]

How long had the Ltd existed and do you still operate the old business? If so, which sector/trade did you use to determine the %?

Incorporated 2014; it is/was a software company, which goes hand in hand with software consultancy - I just assume my contracting is an extension of the businesses activities.

[Pondlife]

Part of the problem is I just used (naively?) the same Ltd. I was using for my business which has existed in some capacity prior to contracting. My mistake.

How long had the Ltd existed and do you still operate the old business? If so, which sector/trade did you use to determine the %?

[VectraMan]

I believe you can claim for 6 months pre-registration. So pre-incorporation expenses can be reclaimed even if on FRS (and the 2K limit does not apply)

That's my understanding too. FRS starts on a particular date so anything purchased before that can be reclaimed, even if it was before the company existed, perverse as that sounds.

[mudskipper]

If you want to maximise what you keep, the trick is to put expense everything once you've register for VAT (and hence claim the VAT back) THEN join the FRS, just before you start billing

You've probably missed the boat on that though if you're already signed up for FRS

I believe you can claim for 6 months pre-registration. So pre-incorporation expenses can be reclaimed even if on FRS (and the 2K limit does not apply)

[MrMarkyMark]

Not really; if you take a single sentence as the one truth then yes. Go down the rabbit hole of EEA legislation on the Gov website and suddenly it's doesn't seem as simple as reducing it down to a single, simple assertion - even though in my position, it does seem I can't claim it back.

But logically, why do you think you would be able to claim VAT against foreign expenditure
I can only assume you would rather be that way, to suit your circumstances, no?

[TheGreenBastard]

Spending time speaking to your accountant early in would have been easier though.

Part of the problem is I just used (naively?) the same Ltd. I was using for my business which has existed in some capacity prior to contracting. My mistake.

[northernladuk]

Sadly yeah, you live and learn!

Spending time speaking to your accountant early in would have been easier though.

[MrMarkyMark]

If you want to maximise what you keep, the trick is to put expense everything once you've register for VAT (and hence claim the VAT back) THEN join the FRS, just before you start billing

You've probably missed the boat on that though if you're already signed up for FRS

Agreed. The main issue is his ongoing VAT able costs imo.

[TheGreenBastard]

If you want to maximise what you keep, the trick is to put expense everything once you've register for VAT (and hence claim the VAT back) THEN join the FRS, just before you start billing

You've probably missed the boat on that though if you're already signed up for FRS

Sadly yeah, you live and learn!

[TheGreenBastard]

Not really, the statement above is really very clear, no?

Not really; if you take a single sentence as the one truth then yes. Go down the rabbit hole of EEA legislation on the Gov website and suddenly it's doesn't seem as simple as reducing it down to a single, simple assertion - even though in my position, it does seem I can't claim it back.

[pr1]

If you want to maximise what you keep, the trick is to put expense everything once you've register for VAT (and hence claim the VAT back) THEN join the FRS, just before you start billing

You've probably missed the boat on that though if you're already signed up for FRS

[MrMarkyMark]

OK so it's applicable intra-country in the EEA. It's seems a reasonable to question to ask.

Not really, the statement above is really very clear, no?

[TheGreenBastard]

Which part of the following are you having trouble understanding

OK so it's applicable intra-country in the EEA. It's seems a reasonable to question to ask.