Steevo
Member
- Location
- Gloucestershire
Bought my N early for £278(smug smiley face). If its worth £600 odd at my year end in March do I have to value it at that?
If so does it means I will be taxed on the gain on a product that I am not going to sell.
How does that work?
If you don’t intend to sell it, it’s value to you/your business is what you paid for it.
Stock is always valued at the lower of cost or market value to be conservative or else you face exactly the problem you mention.
So it’s valued at £278 in your stock, because that’s what you paid for it. But the produce you then sell from using it for production will likely benefit from a higher resale value, and you’ll pay tax based on this realised profit after you have sold it.
@farmerdan7618 will probably be able to explain better.
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