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stock / end of year returns

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not sure how this is dealt with? apols if its a silly question? sole trader doing SE assessment.

if you buy stock during the last tax year but it will not sell until next tax year, how do you account for this in your returns?

for simplicity of example:

stock purchased in 13/14 totals £1000

will not sell until 14/15 say for £1500

so do you return:

13/14 loss of £1000

14/14 profit of £1500

or:

is it 13/14 loss £0, as you still have the £1k worth of stock as 'assets'? confused..

Comments

  • Suarez
    Suarez Posts: 970 Forumite
    You need your opening stock figure to do this (The closing stock from 12/13 year end)

    You would then do opening stock + purchases - closing stock to get your cost of goods sold figure.
  • Aquamania
    Aquamania Posts: 2,112 Forumite
    skater_kat wrote: »
    not sure how this is dealt with? apols if its a silly question? sole trader doing SE assessment.

    if you buy stock during the last tax year but it will not sell until next tax year, how do you account for this in your returns?

    for simplicity of example:

    stock purchased in 13/14 totals £1000

    will not sell until 14/15 say for £1500

    so do you return:

    13/14 loss of £1000

    14/14 profit of £1500

    or:

    is it 13/14 loss £0, as you still have the £1k worth of stock as 'assets'? confused..

    Stock is included as assets.
  • zygurat789
    zygurat789 Posts: 4,263 Forumite
    Part of the Furniture Combo Breaker
    skater_kat wrote: »
    not sure how this is dealt with? apols if its a silly question? sole trader doing SE assessment.

    if you buy stock during the last tax year but it will not sell until next tax year, how do you account for this in your returns?

    for simplicity of example:

    stock purchased in 13/14 totals £1000

    will not sell until 14/15 say for £1500
    You are not taxed until you have realised the profit so no.

    so do you return:

    13/14 loss of £1000
    But you still have the stock, so it must be an asset, no profit, no loss.

    14/14 profit of £1500
    Presumably 14/15? Stock brought forward £1000 sales £1500 profit £500

    or:

    is it 13/14 loss £0, as you still have the £1k worth of stock as 'assets'? confused..
    Exactly

    Still confused?
    The only thing that is constant is change.
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