Capital Allowances When Business Has Closed

twinkle-star

Hi everyone, I’ve been self employed with a very small business (mostly ebaying) for the past 2 years. I’ve just done my profit/loss account for the 08/09 tax year and I’m a bit stuck on the capital allowances bit!

I closed my business in March 09 and have no capital allowances to introduce for this year. However, an accountant did my profit/loss summary for me last year and also did the capital allowances bit. Because I have now stopped trading I’m not sure what I’m meant to do. Do I record the same allowances on my current tax return, or do I leave it? Am I meant to give them a value and count them as profit due to the fact that I’ve ceased trading?

Here’s what the accountant wrote for my 07-08 accounts:

Additions introduced - £300

Less allowances claimed - NIL

Tax WDV Carried Forward - £300

The above concerned (as far as I remember) a printer, scales and some bookcases. I can’t even remember if there was anything else. He may have included my home computer but I’m not sure.

Any help would be greatly appreciated and thanks in advance to anyone who can.

mrkbrrws

Give the equipment a value, take it off the £300. The difference is your capital allowance to enter on the Tax Return.

Strictly if there has been any private use you should only claim a proportion of the allowance.

twinkle-star

mrkbrrws wrote: »

Give the equipment a value, take it off the £300. The difference is your capital allowance to enter on the Tax Return.

Strictly if there has been any private use you should only claim a proportion of the allowance.

Thanks for that. So if I value them at £200, the capital allowance for the tax return would be £100? And if so, would that £100 then be added to my profit for the year?

But shouldn't the value be the same as it initially was (£300)?

Sorry for all the questions, I just can't get my head round the capital allowances bit.

Thanks again.

mrkbrrws

The capital allowance would be £100 but you deduct it from your profit.

The value should be what you think they are worth when you finished trading.