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VALUATION OF SMALL AMOUNTS OF TRADING STOCK FROM THE 2002-2003 INCOME YEAR

From the 2002-2003 income year there is new legislation concerning the valuation of small amounts of trading stock at the end of the income year. This means some taxpayers won't be required to do a stocktake as at 31 March, 2003.

Taxpayers are no longer required to value their closing stock or include any change in the value if:

	their turnover (total gross income) is $1.3 million or less for the year, or
	they reasonably estimate that their trading stock on hand at balance date is less than $5,000

In such cases taxpayers are entitled to use the same figure for closing stock in the financial statements as the opening stock.

Please note that even if taxpayers qualify for this simplified method for valuing stock, they dont have to use it- its optional. They are still entitled to do stocktakes and get a true value for their trading stock if they wish to.

This change is designed to reduce compliance costs associated with valuing and making adjustments for small amounts of trading stock at the end of the year.

If we can assist further, please email TotalAccounting as follows:

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From the 2002-2003 income year there is new legislation concerning the valuation of small amounts of trading stock at the end of the income year. This means some taxpayers won't be required to do a stocktake as at 31 March, 2003.

Taxpayers are no longer required to value their closing stock or include any change in the value if:

their turnover (total gross income) is $1.3 million or less for the year, or

they reasonably estimate that their trading stock on hand at balance date is less than $5,000

In such cases taxpayers are entitled to use the same figure for closing stock in the financial statements as the opening stock.

Please note that even if taxpayers qualify for this simplified method for valuing stock, they dont have to use it- its optional. They are still entitled to do stocktakes and get a true value for their trading stock if they wish to.

This change is designed to reduce compliance costs associated with valuing and making adjustments for small amounts of trading stock at the end of the year.