New Business Initial Inventory Strategy
If you started your business sometime after 1 Jan of this year, then this will most likely be your first tax return and you will not need to change your inventory valuation method.
Your strategy however will depend on how long it has been since your business began and your ability to reconstruct your stock changes from this date to the current date.
I can reconstruct my stock history back to the beginning of my business.
If you have kept good records of your manufacturing and purchase activity (i.e. when you made products and what materials you used) then you can consider backdating to the start of your business.
This method involves reconstructing all stock changes right back to the date you began your business, then finally reconciling your Craftybase stock levels with what is currently physically on hand.
I cannot reconstruct my stock history back to the beginning of my business.
If you don’t feel you can construct your complete manufacture and purchase records, then you may be better to to consider indirectly expensing for your materials up to the date you began with Craftybase and then switch to COGS at this point.
This method involves starting to track your inventory using COGS from today forward, with all previous material expenditure claimed as an indirect expense.