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Transfer of website/software system

BowdentBowdent Settling In NicelyRegistered Posts: 22
Hi Guys

I have a client that spent about £10k on developing an in-house web-based MI system that records sales data, employee data and hours, costs etc. The idea was to use it through out their business, which they've done. However, about 6 months ago they created a new company which all of the future development costs for the MI system will go through and that the new company 'owns' the software, licensing it to the original company.

The client is currently showing £10k of assets relating to the software development on its balance sheet but as the asset was effectively transferred to the other company (owned by the same shareholders/directors), I'm not sure how to take it off the balance sheet, if it should at all. It was originally being written off over 5 years.

Any assistance or guidance on the procedure here would be most welcome.
Thanks

Comments

  • stevo5678stevo5678 Well-Known Cheltenham Registered Posts: 325
    If you can value it reliably or even just transfers it at the TVDW then I see no tax issues in selling it to New Co like a normal asset. I'm sure there are various accounting standards in play but intangible assets is a bit of a mind field and if there is no revenue loss to HMRC then this won't create an issue.

    Steve
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