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Presentation and S266

Presentation and S266

Sole trader incorporated and applied for s266 to transfer assets at tax written down value to the company. My question is about presentation on the final accounts. Are the balances transferred to the fixed assets in opening balances brought forward or are these added to the additions section in the fixed assets.



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07th Sep 2011 19:38

I am confused

What has s.266, a tax section, got to do with disclosure in the accounts?

If, by "final accounts", you mean the cessation accounts of the sole trader, I would treat the assets as having been disposed of with the TWDV as the proceeds, thus creating a profit/loss on SOFA and no fixed assets in the balance sheet.

If, by "final accounts", you mean the first statutory accounts of the company, you cannot have an opening balance on fixed assets - the assets transferred from the sole trader will obviously be additions for the company.

Don't forget that you cannot claim AIA in the company on the assets acquired from a connected person.

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