Cake business Nominal codes

Simon

Hi all.
Can anyone help with what Nominal Codes should be used for a cake making business.

The one I am struggling with is cake tins and what code to use. I am guessing as its equipment and as there are used all year round, I think I may have to make a NC of something like 0032?

That then brings me onto cake paper cases for use on customers cakes, would it be sensible to use "Packaging" with NC of 5003?

Also, the ingredients to make cakes, would I use NC 5000 "materials purchased"?

Hope someone has a similar business and can give some advice.
Thanks in advance.


Si...:
001_smile:

wbauk2002

It depends on how much the cake tins cost, less than £500 can go to p&l, so anywhere above nom code 6000, otherwise you have to depreciate them, and go through captial allowances at year end, and I'm guessing you won't reach the annual investment allowance so p&l is fine

The cake papers are a cost of goods sold, so in 5003 is fine or anywhere between 5000 and 6000

KernowAccountant

wbauk2002 wrote: »

It depends on how much the cake tins cost, less than £500 can go to p&l, so anywhere above nom code 6000, otherwise you have to depreciate them, and go through captial allowances at year end, and I'm guessing you won't reach the annual investment allowance so p&l is fine

The cake papers are a cost of goods sold, so in 5003 is fine or anywhere between 5000 and 6000

Would you be so kind as to cite the legislation which provides for items under £500 "go[ing] to p&l" for tax purposes please?

wbauk2002

It would be the companies policy, 500 is pretty standard, where I work anything less than 2k goes to p&l

I'm assuming you wouldn't put a £5 cake tin into fixed assets over at kernow accountants?

KernowAccountant

wbauk2002 wrote: »

It would be the companies policy, 500 is pretty standard, where I work anything less than 2k goes to p&l

I'm assuming you wouldn't put a £5 cake tin into fixed assets over at kernow accountants?

Quite - a company's accounting policy can determine the accounting treatment - tax law (not accounting policies) determine the tax treatment. The OP needs to consider this before blindly expensing capital items. I don't believe you'll find any concept of materiality or a de minimis in tax legislation when referring to the capital/revenue divide.

FWIW, if an item is capital in nature - I capitalise it. If revenue in nature - I expense it!