Sole trader to Ltd

Hi

I have a client who has recently converted his status from sole trader to the limited company. At the date of the transfer his balance sheet is following

Fixed assets 10,000

Stock            10,000

Debtors         10,000

Liabilities       (80,000)

Prop account 50,000

Once I transfer the same balance sheet as a going concern to ltd company, then presumably the propertier account will become director loan account and becuase its a debit balance it will be considered as overdrawn and therefore Sec 419 implication.

I thought about bringing goodwill, however it wouldn't be justifiable and will easily be questioned by HMRC because of the losses.

Please let me know if there is a way around or if there is an error in the way I am calculating the transfer.

Comments
There are 17 comments. Login or register to view them.

No

occca |

No

asimmalik78 |

asim, you need understand

Anonymous |

More explaination

asimmalik78 |

incorporation relief !!!

Anonymous |

this is getting odder with each new posting by the OP

nobbie |

Insolvent company trading illegally

Laurence52 |

Right way?

vdeepan3 |

vdeepan3

nobbie |

.

oktax |
oktax's picture

oktax

nobbie |

vdeepan3 and asimmalik78

nobbie |

Objective

asimmalik78 |

???

nobbie |

alpha, beta, whatever

oktax |
oktax's picture

Reputation

vdeepan3 |

vdeepan3

Anonymous |