Hi. My client used to be a partnership and no they become a limited company. The equipment they used when they were partnership is has to be transferred now to their company - what double entry should I do to transfer this equipment? Thank you.
The double entry would be DR Assets CR DLA Accounts (with split - Assuming partners are now directors) as it is effectively capital introduced
However I think there may be more to it from a tax point of view. Is there any goodwill, what about all the other assets / liabilities of the partnership..?
Was the Partnership closed down and remaining capital distributed amongst partners and then a new company set up from scratch?to then introduce the fixed assets??
There are tax experts on this site so hopefully they can help with any other issues about incorporation and transferring trade.
HTH
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just to follow up the above reply. (sorry not a lot of time at the mom so this is a pointer rather than an answer in itself).
A partnership is just a collection of self employed individuals.
A limited company is a totally seperate legal entity.
There will be tax implications of transfer of assets on incorporation but the good news is that there is something called incorporation relief.
As I say, bit busy at the mo so I'll leave you to do the follow up leg work.
kind regards,
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
