One business - Two trading names - help!

System
System Posts: 100,537 🤖 Admin 🤖
edited June 9 in General accounting discussion

My client has one workshop, one van and the usual tools and equipment. He makes and installs roller-shutters. When he's asked to make AND install a shutter he's been invoicing in one name, but when he's subcontracted to just install a shutter he's been invoicing in another name. (The reason for this is because he thought that he then didn't have to pay vat on the subcontract work, but that's another story!!)
So now I'm preparing his 2005/06 tax return and have one set of accounts which includes both sides of the business - I've read the IR notes and it does say that where 2 businesses have been trading then 2 sets of self emp pages must be completed, but it would obviously be easier to just do one. Does anyone know how strict HMRC are on this? Do you think it'd be alright to just complete one set of pages on the basis that both businesses are carrying out the same trade?
And if not how detailed do I have to be when apportioning costs? It's easy to separate the income so do you think I could just split the costs to the same % as sales?
I can't wait to have this off my desk!
Jodie

Comments

  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:One business - Two trading names - help!

    This sounds like the sort of job I usually get. I would contact HMRC first in writing to get their opinion. I would have thought that the logical thing would be to put the two names together permanently!
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:One business - Two trading names - help!

    Well i did end up ringing HMRC and asked very nicely if I could report one set of accounts, but if there's an easy way and a hard way you know which one the revenue will insist on...
    anyway, turns out that one business made a profit of £4k and the other made a loss of £500, so no tax due on the £4k and he gets to carry the loss back to last year! - i guess it now looks like he's split the business to evade tax...
    and TC you're right - he WILL be picking a name and sticking with it from april (or else he can find someone else to do his accounts) :lol:

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