Buying a partner's asset
jennywilson
Registered Posts: 1 New contributor 🐸
A partner is introducing his second hand car into the company.
It was bought 2 years ago for £75,000, a deposit of £10,000 was paid.
The car is now worth £31,000 but the finance outstanding is £34,000.
The partner paid the deposit and the monthly payment for the last two years.
The partner concerned would like the deposit paid back to him which I assume would be shown as other income so is subject to tax and ni.
When introducing a second hand asset is a written valuation required and if this is lower than the outstanding finance what are the entries in the accounts?
It was bought 2 years ago for £75,000, a deposit of £10,000 was paid.
The car is now worth £31,000 but the finance outstanding is £34,000.
The partner paid the deposit and the monthly payment for the last two years.
The partner concerned would like the deposit paid back to him which I assume would be shown as other income so is subject to tax and ni.
When introducing a second hand asset is a written valuation required and if this is lower than the outstanding finance what are the entries in the accounts?
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Comments
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Car purchase
Hi Jenny
Could you just clarify whether this is a director bringing his car into the company or a partner bringing his car into a partnership.0
