How to do this?

lang8er

Hi all,
I need some advice.
I have set up as a sole trader. I sell gifts via the web and at party plan. My mother-in-law is doing the same and we are selling under the same company name. However becuase she is older she would prefer for me to deal with taking payments etc as she already has a hectic life and wants me to keep an eye on accounts (I am a Mum with plenty of time on my hands). We have started buying stock together (half each). I haven't been trading for 3 months yet and am meeting with an accountant in 2 weeks time. I just wondered how taking payments but still giving her share of profits minus tax would work. Sorry if I sound vague but this is all very new to me and I am learning as I go. Mother-in-law doesn't have a business bank account and doesn't really want to go down this route, however I do and I also have a merchant account and chip and pin machine. I want to go down the proper route if you know what I mean but now we have bought stock together is this going to make my life really complicated!!???
Any advice gratefully receieved!!!
Thanks

windswept

you should register as sole traders in partnership, you don't have to be equal partners.
on your partnership tax return (ask for this to come to you), all you have to do is allocate the percentage of profits/expenses for each of you and you will be taxed independantly, she will have her own sa fom to fill in.
whichever way you give her money from the business is irrelevant, it comes under "drawings" in your accounts.
If your business turnover is less than £15000 p.a. you only have minimal informaton to provide to the taxman. turnover minus expenses equals profit.
just make sure that you fully understand "cost of sales" when working out your expenses: i.e. you only count the cost of stock once it has been sold.

windswept

Have a look at the different tax forms , you can view them online or download them from the hmrc website. once you get a feel for them they are simple and if all you are doing is selling to customers you really don't need an accountant , especially if you keep your accounts in good order.
I find using an old-fashioned accounting book very useful-just keep all your receipts, invoices , everything in fact. you fill the book in weekly and at the end of the tax year just total up all the columns and you have all your figures, all you then have to do is work out your cost of sales by doing a stocktake and that's it.

lang8er

Thanks for that - really useful info!!!
I am off to have a look at the tax forms.
Some of the stock is solely mine and some is shared so it might be hard to figure out the percentage but I suppose not if I keep a good record?

Thanks for your help!

lang8er

Or would I do a seperate return for the stock I have bought myself? Am I making sense lol! Might pay me to visit the tax office and run through it all!