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Adam Hunt
Adam Hunt, Accountant
Category: Tax
Satisfied Customers: 389
Experience:  FCCA, FFA, FFTA
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Dear Sirs, This relates to a trading limited company that

This answer was rated:

Dear Sirs,
This relates to a trading limited company that also has used some of their spare cash to invest in shares through their limited company.
My two questions are:
1. If shares are sold, and there is a gain, where does this gain get reported in the company accounts?
2. And I presume this then goes on the Company Tax Return too?
Thank you very much.

Hi I am one of the experts. Answers to you questions are given below.

1. If shares are sold, and there is a gain, where does this gain get reported in the company accounts?

Ans. Yes
2. And I presume this then goes on the Company Tax Return too?

Ans. Yes

Hope I have answered your question?

Customer: replied 14 days ago.
The question was WHERE does this gain get reported in the company accounts?

Ans is Yes it will be reported in the company Accounts. Is that clear now?

Customer: replied 14 days ago.
No, I really don't think you understand the question! The question is WHERE would this be posted in the accounts? As in, whereabouts in a full set of accounts would the amount be posted to?

I am an Accountant and this is what I do normally every day. I have clearly answered your question that since company has invested into Shares then any such gain should be reported in the company's accounts because this is the investment of the company. Ok?

Company statutory Accounts means full set of Accounts and this gain should be reported in that. Hope now it is all clear?

Customer: replied 14 days ago.
My question is WHERE does this go in the company accounts?! For instance, "profit & loss on disposal of assets," or within "turnover" (obviously not but an example), or where? As in whereabouts in the accounts does the gain go?
Customer: replied 14 days ago.
or extraordinary income?

Answers given below:

My question is WHERE does this go in the company accounts?! For instance, "profit & loss on disposal of assets," or within "turnover" (obviously not but an example), or where? As in whereabouts in the accounts does the gain go?

Ans. You have sold investment which is the Asset in the Company Accounts. So, this is the gain from the Disposal of an Asset and should be reported in the P&L.

Normally there is an Account in the P&L which we use for the Gain arisen via the selling of an asset. Please use that account.

Ok?

Customer: replied 14 days ago.
thank you

You are welcome. Please also rate me before you leave.

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