I am preparing a childminders accounts for her 2017 tax return. She had to give up her business for health reasons at 31.03.17. She has a car in the business, so do I have to dispose of it, i.e transfer it to her. I think that it will be a profit and not a loss on her capital allowances. The b/f is £2815, her car is a grey Citroen C4 Grand Picasso 1.6 hdi 16v 58 reg 5 door and I managed to get a valuation of - private value is £2450 and the dealer value is £3020 - £3330. I can't think how I can post value it to 31.03.17.
I hope this makes sense, I don't know if it does, my brain is very fuddled at the moment from too many tax returns.
Hi thanks for the reply, not exactly sure where the valuations came from, somewhere on the internet as my husband found them for me.
As at 05.04.16 the value of the vehicle in the a/cs was £2614.
Do I have to transfer the car out of the accounts is my main question really as she has ceased?
Her illness is actually an operation to remove a benign tumor in her arm. The operation was in early April 17, but the recovery was slow and she reluctantly decided that she couldn't look after the children any more so since she didn't work after 31.03.17, for convenience it was decided to finish it then.
Go back and get a range of dealer figures. You cannot just use the car info you mentioned above as mileage is a big thing, so check out the car again with mileage via Autotrader, as this is the biggest and probably most well known site there is.
Keep evidence of the valuations you have checked, ie prints, or convert to PDFs and keep for in the event of an inspection - you need to be able to justify the value that you used.
Do you know how to dispose of the asset in your accounts?
There is difference in your brought forward figure in the 1st v 2nd posts.
You will have a balancing charge by the looks of it.
The prices quoted are what the car would be expected to sell for, so at a dealers it would be the 3 to 3.3k, no way would they pay that much for it. Depending on what nick the car's in I'd be looking for a price in the 2 to 2.3k range. Your best bet is to look on Auto Trader and see what they are selling for. I definitely wouldn't be looking at more than 2.5k
Edit
Morning Joanne, you sneaked in an extra post there when I wasn't looking lol. Forgot about mileage making a difference but we agree on Auto Trader.
-- Edited by Leger on Monday 22nd of January 2018 09:15:46 AM
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
is this the same childminder who was attempting to put her garden office thing and boiler through the books? What then is happening to those items, plus anything else?
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
Hi Joanne, it is the same childminder, but in the end these things didn't go through the books. I shall do as you both suggested and look on Auto Trader.
Hi thanks for the replies. Just as a quick recap, the car has to be transferred out, it can't just stay in?
Nicola
If there's a balancing charge, then yes, as there will be tax due.
If there's a balancing payment due, then you are depriving the client of a tax rebate if you don't take it out (Read it as friendly advice, not as having a go at you, as it looks a bit harsh in print)
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
