stock bought from personal funds before incorporation

stock bought from personal funds before...

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I am now starting a small business. I need to place an order for my stock now, and so will have to pay for it from my personal bank account. I basically want to know how this will be shown in the accounts, and if I can get the money back out of the compan tax free.

Once the company is incorporated I need the cost of purchasing the stock to show in the accounts so it can be deducted from the profit before tax.

Is stock purchased before incorporation treated as an expense? If so, would this enable me to take the money back out of the company tax free?

Many thanks
Victoria Ward

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By NeilW
14th Jun 2007 13:53

Directors Loan
If you pay for anything on behalf of the company you become a creditor to the company.

I would make sure the company's name is on the invoice and then the company can just reimburse you without adding to the paperwork, and without causing tax headaches.

I find that's the pragmatic approach.

NeilW

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