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How do you Value a domain portfolio when transfering to a ltd company?

Discussion in 'General Board' started by mally, Jan 31, 2011.

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  1. mally United Kingdom

    mally Well-Known Member

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    Hello all, I'm in the middle of transfer my business to a ltd company, and advice on how to value the domain portfolio?

    I've got 1,000 .co.uk's , not sure if anyones done something similar in the past?

    Thanks Mally
     
  2. Domain Forum

    Acorn Domains Elite Member

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  3. bb99 United Kingdom

    bb99 Well-Known Member

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    I would use the cost if I were you.

    This particularly applies if you're going to classify the domains as "stock" in your new company. Stock should always be valued at the lower of cost or net realisable value. So unless any ofthe domains are completely worthless (!) then use cost.
     
  4. BREWSTERS United Kingdom

    BREWSTERS Well-Known Member

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    I'm no accountant, but I think you should be placing a value on them at your cost price. When buying a company, I think you value any (product) stock at the lower of cost or liquidation value.
    As domains are unique and not very liquid, your cost price is the only thing you can go off really.

    Just my thoughts based on previous experience which I may or may not have recalled 100%.

    Edit: Just seen bb99's post so seems correct.
     
  5. grantw United Kingdom

    grantw Well-Known Member

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    I've just done it, as above I used the cost price.

    Grant
     
  6. rob

    rob Founding Member

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    Yes - cost / 'book' value.

    Plus 'goodwill' and enhancements if any have any...
     
  7. namealot United Kingdom

    namealot Well-Known Member

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    Depends on why you’re setting up the LTD in the first place..

    More "respectability" easier to do business etc …doesn’t really matter on value of assets

    It may help secure future funding if the value is higher but how much scrutiny this would stand up to is questionable..?

    Also names dropping are there implications as to disposal of assets/depreciation etc

    Think about how secure you want to make the assets (domains) of your company..? If you want to make it secure for yourself set up another company to loan/lease them to the first.

    The company becomes an entity itself and owns all your names which may have long term implication ( sale in the future if you close the company down )

    An accountant would be your best bet ?
     
    Last edited: Jan 31, 2011
  8. TinkyWinky United States

    TinkyWinky Well-Known Member

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    depends on the size of the DL you want to create ;)
     
  9. DomainManagement

    DomainManagement Active Member

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    Depends also in what jurisdiction offshore can be attractive for some

    and there tax planning , depends on what you consider your portfolio to be

    worth , and what sort of margin your making when selling

    just for my two pence worth . have info if your interested pm
     
  10. Marcoose

    Marcoose Well-Known Member

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    Just regarding offshore incorparation, do you know whether you can do this when you spend 99% of the year in the UK?
     
  11. Edwin

    Edwin Well-Known Member

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    Your best bet is to speak to a specialist accountant, but one way might be if the official "management" of the company (ie strategic decisions etc) is carried out offshore by somebody resident in the target jurisdiction. That MIGHT let you get away with the day-to-day work in the UK while maintaining the company's offshore status. But as I said, expert advice is a MUST!
     
  12. Bailey United Kingdom

    Bailey Well-Known Member

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    I always thought you should view the vat threshold figure as a potential transition point to Company status. I have to admit to never delving deeper than the last letter from the tax-man scared me to
     
    Last edited: Feb 2, 2011
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