Cessation of a business

Cessation of a business

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When does a business cease? (sole trade)

My client ran a clothing shop.  He vacated the premises in Nov 2013. He took the stock and started selling on Ebay and market stalls.  At the end of March the remaining stock was taken to a charity shop.  He still has some of the shop fittings but these will more than likely be scrapped.

There is still a business overdraft and a balance on the Co Credit card to be paid.  Charges are being added each mth.

I think the business ceased when the stock was given to the charity shop. Would anyone disagree?

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Stepurhan
By stepurhan
24th Jun 2014 11:27

I concur

Up to that point he was actively trading, albeit the manner of trading changed in November 2013. Once he has disposed of the last of the trading stock, he no longer has anything to sell, so he cannot be trading after this date. Retaining the shop fittings is only likely to be relevant from a capital allowance point of view if at all. As they are likely to be written off, that will be either a balancing allowance or nil if AIA was taken on them all.

I don't think you can claim for the ongoing finance costs after cessation, as they no longer relate to a business.

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