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    • Salsaholics
    • By Salsaholics 8th Jan 18, 11:23 AM
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    Salsaholics
    Transferring assets into self employment
    • #1
    • 8th Jan 18, 11:23 AM
    Transferring assets into self employment 8th Jan 18 at 11:23 AM
    Hi,
    I've recently bought a lot of equipment in order to learn a new skill and craft that I eventually hope will earn me some money by selling the items I make.
    If I start off as a hobby (whilst I learn and perfect my skills and products and not sell anything) can I then later transfer my equipment and 'stock' from being personally owned into being owned by myself as a 'self-employed' trader to be included on a tax return at the point I start to sell things. And could this be done as cash basis accounting. (Want to keep it simple as I have never done a tax return in my life as have always done PAYE).
    Alternatively should I start keeping records now of all of my expenses and class myself as self-employed from the outset and all equipment owned by the 'business'?

    On the face of it it seems simplest to just transfer all of the personal assets (which have been paid for from various personal accounts and cards) into the "business" at the point of trading (when I could have set up a seperate bank account for the business)? Are there any problems with this? And how would I do this as I'm effectively selling my equipment to myself? (intend to just be self-employed/ soletrader). Is there any official / accepted way that this should be done? Not finding the HMRC website very helpful.

    Thanks for any advice...
Page 1
    • Pennywise
    • By Pennywise 9th Jan 18, 8:11 AM
    • 10,232 Posts
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    Pennywise
    • #2
    • 9th Jan 18, 8:11 AM
    • #2
    • 9th Jan 18, 8:11 AM
    Pretty standard practice to bring in "private" stuff into a business start up at open market value, i.e. second hand value, if it's been previously used and bought a while ago.

    For more recent purchases, i.e. something bought the month or two before trading starts, you'd be able to bring it in a cost price as you could claim you'd bought it "in anticipation of" trading rather than for private use.
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