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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 7982
Experience:  FCCA - over 40 years experience as a qualified accountant (UK based Practitioner)
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I run small business that sells clothes online and my

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Hi Pearl, I run small business that sells clothes online and my company accounts are due soon. Would you be able to give me advice?
JA: Have you talked to a tax professional about this?
Customer: No
JA: Is there anything else the Accountant should know before I connect you? Rest assured that they'll be able to help you.
Customer: That is all

Hello and welcome to JustAnswer. I’mCustomer a UK qualified accountant. Please expand on your question

- what sort of advice do you need

- is it your first year of filing accounts

- what is your accounting year end date
Many thanks

Customer: replied 15 days ago.
We need advice on what particular items would be classed under assets, liabilities and our creditors
Our accounting year date is 10 February 2020 to 28 February 2021
This our first year of filing
Customer: replied 15 days ago.
From our understanding our assets would only be our stock as we are solely online and do not have a premises etc. Would we be able to class all of our expenses for the year under our liabilities?

Thank you for your reply.

If you don't own any fixed assets then you would show stock and bank balance under current assets.

Creditors will include amounts owing to suppliers if any, director's account and provision for corporation tax (if the accounts show profit)

Expenses incurred during the year will be shown as cost of sales and expenses on the profit and loss account and not under liabilities.

Liabilities are what the company owes to outsiders at balance sheet date i.e. 28 Feb 2021.

My aim is to give you a professional service. I hope this is helpful and answers your question.

If you need more assistance, please use the reply box below and let me know. It has been my pleasure to assist you with your question.

Customer: replied 15 days ago.
Thanks for the detailed response. Should we leave the creditors section blank as the only thing we pay our suppliers is the money needed for stock, nothing else
Customer: replied 15 days ago.
Would you be able to provide us with an example as to what exactly would be owed to outsiders outside the business?
Customer: replied 15 days ago.
If we do not owe any outsiders anything, the liabilities section would be left blank?

Thank you for your reply.

If you have made a profit then it is adviseable to reflect corporation tax payable on it as an expense and creditor (liabilities) as payment will take place at a future date.

If the company does not owe you any money for payments made out of own funds and there is no provision for CT then liabilities will be blank.

I hope this is helpful and answers your question.

taxadvisor.uk and other Tax Specialists are ready to help you
Customer: replied 15 days ago.
Okay thanks, ***** ***** to assets. We would have input the amount of assets we have acquired up until 28th Feb 2021. Currently current assets will only be stock and cash in bank. For our stock would we input the value the stock is worth for example 50 hats priced at £10 would be £500. Lets say we bought it the 50 hats for 200 for them in bulk.Would we then input our stock at the value it is worth or the value we bought it at, within the year up until 28 Feb 2021?
Customer: replied 15 days ago.
Are you still there?

Thank you for your reply.

Stock is valued at lower of cost or net realisable value. In your case you value it at your buying price.

I thank you for accepting my answer.

I'm glad I couldhelp you resolve this today. Please follow up here if you have any other questions.

Best wishes.

Customer: replied 15 days ago.
Okay, with regard to the cash in bank and stock both being current assets. Would I have to include the amount of cash I had in the bank throughout the year?

Balance sheet is a snap shot at year end date.

You will put in current assets the bank balance at 28 Feb 2021 and also stock on hand at that date.

I hope this is helpful.

Customer: replied 15 days ago.
That would be the closing balance at that date right?

Yes.

Customer: replied 15 days ago.
for the stock I would not have to input the amount of stock that was bought up until that date?

You only input in the balance sheet stock that was bought and not sold at year end date. It is what you are holding for resale after year end.

I hope this is helpful.

I have now answered all your questions and we should close the question now.

Many thanks.

Customer: replied 15 days ago.
Okay thank you for your time
Customer: replied 15 days ago.
based on your answers, the only thing we would input into our balance sheet is our current assets
Customer: replied 15 days ago.
For capital and reserves on the balance sheet, would we also have to input the amount of capital invested throughout the year up until that date?

If you don't owe anyone any money then you would input stock and bank balance as your current assets.

Capital and reserves has been answered under separate question.

Many thanks.

Customer: replied 15 days ago.
I would have to ask the capital and reserves under a seperate question?

You have already done so and I have answered it here

https://professional.justanswer.com/oprc/products/44121cba41764f6*****************

Many thanks

Customer: replied 15 days ago.
I was denied access to that link
Would you be able to kindly give the reply again?

Thank you for your question.

Capital and reserves is made up of

- called up share capital ( as reported on confirmation statement or when the company was incorporated)

- retained earnings for the year (as it is your first year it will be the profit or loss made in the year).

Once you have prepared your accounts and you need help with review of your figures before submission to Companies House and HMRC, please come back with a fresh question and I will help you.

My aim is to give you a professional service. I hope this is helpful and answers your question.

If you need more assistance, please use the reply box below and let me know. It has been my pleasure to assist you with your question.

Customer: replied 15 days ago.
Thank you for the definition of each category, the question I have is...Would I put the value I have invested into the business throughout the year up until 28 Feb 21 or just on that month date?

There is a difference between what you have invested in the company to fund working capital and what you invested to acquire shares in the company.

What you Invested to fund working capital and buy initial stock items etc throughout the year is creditor and sits within liabilities and what you paid for the shares is capital and reserves.

If you need further help, I will be able to offer that as premium service for which there is a charge.

Many thanks.

Customer: replied 15 days ago.
if I have paid my suppliers for stock I have to input this value down as my current assets and also in creditors under liabilities?
Customer: replied 15 days ago.
You previously mentioned "If the company does not owe you any money for payments made out of own funds and there is no provision for CT then liabilities will be blank"
Customer: replied 15 days ago.
what I have invested to buy stock will go under creditors, liabilitles?

So if I have paid my suppliers for stock I have to input this value down as my current assets and also in creditors under liabilities? - Yes

So what I have invested to buy stock will go under creditors, liabilitles?

- Yes

Customer: replied 15 days ago.
It is be great talking with you and gathering all this advice, I didn't catch you name. Would you mind telling me it?

Thank you for your kind words.

I am known here asCustomer

Best wishes.