Purchasing/Selling Capital Assets prior to dissolving a company

Lynn

Hi

Could I have some thoughts on this please:

Director of a company (EOY accounts 31 Mar) buys a company car for £30K on the 29 Mar. In the new FY (1 Apr) decides to dissolve the company and no longer trades through this company (but trades through another), therefore, not using the car for any period of company business. Director then decides to purchase the vehicle at a price of £20K.

Is this allowed?

Lynn

jamesm96

As long as there aren't any creditors who don't get paid then I don't see that there's any issue.

groundy

I would say that HMRC would expect to see the car transferred at a true market value. However, as Mike says if there are no outstanding creditors there shouldn't be any problems.