Two years ago hairdresser A running a salon as a freelancer in a converted garage. Pays rent to family member-owner of garage.
At the same time sets up a Ltd company with a view to finding proper premises.
No premises found, covid hits, company files dormant accounts in first year. Hairdresser A sells up all items in 'garage salon' and sits tight.
Ltd company takes on a lease one month before its second-year end but due to covid restrictions and fit-out time doesn't start to trade until its third year.
1) There are no real records for the sale of the garage salon assets and unlikely any gains, so nothing to report here?
2) Is Limited company still dormant in year 2 as not trading, despite taking on the lease? Everything has been self-funded through savings, family loans and bounceback loan.
3) Hairdresser A's new salon is all rent-a-chair based (with, to be fair, a pretty watertight agreement between salon and stylists, so only Ltd reports chair income not stylist income and is therefore under VAT threshold). However, she considers herself still a freelancing stylist whilst also being sole director of the salon owning company. Is this setup allowed?