Capital gains on assets not from property.

PokerPlayer111

Pennywise wrote: »

Unless you're a sole trader who has adopted the simplified cash accounting basis, then buying stock doesn't reduce taxable profits.

I've been a sole trader up to now with the business i remember ticking something like that on my self assessment.

This tax year my partner has joined my business, we've registered a partnership for the business, does that mean we cant speculate to try and grow business on buying huge tons of stock and deduct from profits? Maybe we are better off not being in a partnership and both be sole traders?

Obviously i need to get an accountant i guess.

[Deleted User]

PokerPlayer111 wrote: »

I've been a sole trader up to now with the business i remember ticking something like that on my self assessment.

This tax year my partner has joined my business, we've registered a partnership for the business, does that mean we cant speculate to try and grow business on buying huge tons of stock and deduct from profits? Maybe we are better off not being in a partnership and both be sole traders?

Obviously i need to get an accountant i guess.

OK - it is a partnership - a whole new ball game. This means three tax returns - one for the partnership and one for each partner. I would strongly advise that you seek professional advice (tax deductible) as you really need to be confident of what you are doing.

00ec25

PokerPlayer111 wrote: »

Hmmm yeah this is a potential concern. Trying to get head around this. Its a newish business, money has to be speculated into clothing stock which only makes a profit when sold. The earnings might actually not be more than £11.5k anyway tbh but if the £11.5k was spent on clothing stock a person has "profited" from their unsold stock holdings? hmmmm

why are you asking about CGT when your business appears to be a trading activity purchasing stock for re-sale?

i don't know of any clothing you purchase and sell as an investment subject to CGT other than perhaps Di's dresses that were sold many years ago at auction.

PokerPlayer111

[Deleted User] wrote:

OK - it is a partnership - a whole new ball game. This means three tax returns - one for the partnership and one for each partner. I would strongly advise that you seek professional advice (tax deductible) as you really need to be confident of what you are doing.

We are booked in on monday with accountant, tax deductable eh, nice. Yeah we need to be sure, like you say. I hope accountant doesn't either try and over charge or try and sell some BS investment to cover gains. I assume if accountants mess up then the gov blame them and not us.

PokerPlayer111

00ec25 wrote: »

why are you asking about CGT when your business appears to be a trading activity purchasing stock for re-sale?

i don't know of any clothing you purchase and sell as an investment subject to CGT other than perhaps Di's dresses that were sold many years ago at auction.

The capital gain is purely from a different asset that has nothing to do with the business and never has had. Why im asking is because unlesss im mistaken your everyday earnings change your capital gains tax levels from other assets.

00ec25

PokerPlayer111 wrote: »

I assume if accountants mess up then the gov blame them and not us.

no you sue them for professional negligence - hence you make sure they have theoir own professional negligence insurance cove

they naturally may also try to sell you tax investigation insuarcne becuase they won't do the work supporting you for a tax inbestigation for free

PokerPlayer111

00ec25 wrote: »

no you sue them for professional negligence - hence you make sure they have theoir own professional negligence insurance cove

they naturally may also try to sell you tax investigation insuarcne becuase they won't do the work supporting you for a tax inbestigation for free

Ok do i need tax investigation insurance you think?

If you were to guess a price for this work what you think some might charge total? so i got a approx idea if they over charging etc.

[Deleted User]

Why don't you ask for a quotation at your first interview? In any case, a good accountant will save you much more than any fee, not least the stress of the preparation of end-of-year returns and hoping that everything that you have submitted is correct. A DIY job which proves to be completely wrong will be selected for investigation and you will have to employ an accountant who specialises in tax investigations - without insurance cover for their fees. All of the questions that you have asked, with respect, are very basic - you need the reassurance of a professional.

PokerPlayer111

[Deleted User] wrote:

Why don't you ask for a quotation at your first interview? In any case, a good accountant will save you much more than any fee, not least the stress of the preparation of end-of-year returns and hoping that everything that you have submitted is correct. A DIY job which proves to be completely wrong will be selected for investigation and you will have to employ an accountant who specialises in tax investigations - without insurance cover for their fees. All of the questions that you have asked, with respect, are very basic - you need the reassurance of a professional.

Agree on all of it and getting a quote will be #1 on list, just wont have anything to compare it against as yet.

The DIY job is because of i dont know if i trust the accountants but you make fair points so i have no choice anyway.

[Deleted User]

PokerPlayer111 wrote: »

Agree on all of it and getting a quote will be #1 on list, just wont have anything to compare it against as yet.

The DIY job is because of i dont know if i trust the accountants but you make fair points so i have no choice anyway.

Hmmm - I have a guy coming out to empty my septic tank this afternoon. There is the option of doing it myself but I guess that I will have to trust him. :rotfl: