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Fragrant tax

23 June 2015
Issue: 4506 / Categories: Forum & Feedback , Admin , Business , Companies , Compliance

What are the implications of the omission of perfume from stock figures?

I visited a client recently to prepare March 2015 accounts. The stock list was similar to that of previous years and totalled £100 000. It comprises bottles of perfume – cologne or eau de toilette that are made by the company and are sold to retailers and individuals over the internet.

I wanted to double check that all stock was included and received a positive response but I then asked whether the concentrate from which the final bottled products – and which are much less dilute – are made were included. This received a negative response and a sudden realisation that it had never been included.

The business owner creates the concentrated perfume oils either naturally or by chemical process. This concentrated “parfum” product is then substantially diluted to make the final product say an eau de toilette.

It is estimated that the concentrate stock could produce a...

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