What is a Partnership?
A partnership, which works in a similar way to a sole trader but with 2 or more people. A written agreement should be in place between the partners and profits are usually shared between the partners according to the agreement. Though profits may be shared unequally, liabilities which may arise are shared jointly. This is something that everyone involved in the partnership, should be very clear about. Even if you only own 1% of the business you will still be responsible for 100% of the liability.
What to do when you are in a Partnership
- Register as a self-employed with HMRC within 3 months of your setting up
- Pay Class 2 National Insurance contribution – HMRC will send you Class 2 National bills every quarter unless exempted due to small earnings.
- Set up a separate business account If possible – Ask us if you need to open an account
- Complete an individual Self-Assessment tax return. You’ll also have to fill in the partnership supplementary pages – SA104.
- The nominated partner must also complete a Partnership Return – SA800 – showing each partner’s share of the profits or losses.
- The nominated partner is responsible for sending in the partnership return but you’ll be jointly liable with your other partners for any penalties, surcharges, and interest if the return is late or inaccurate.
- Both partners are personally liable to pay tax on their share of the partnership profits according to the tax band they fall in.
- Both partners are personally liable to pay Class 4 National insurance contribution on any profits above a certain limit.
- Register your Business for VAT if turnover is above the VAT threshold.
- If you have employees, you should set up a PAYE system to collect income tax and National Insurance contributions.
Record Keeping
- Keep records of all Sale invoices
- Keep records of all Purchase invoices Expenses – if you are our client, you can request us a list of possible allowable expenses. This will give you an idea of what you can and can’t claim.
- Keep records of business bank statements Keep Record of VAT – if registered
- Keep a record of all the employees & casual labor
- Keep records of business credit card statements if any.
- Keep records of any other information which you believe is relevant.
For further information and detailed guidance please Click here
What is included in OUR FEE?
- Free initial Consultation.
- Register you as a sole trader
- Register your business as a partnership
- Prepare & file partnership tax return
- Prepare & file Self-Assessment tax return for each partner
- Guide you how the tax system works in UK- Tax, N.I rates, etc
- Guide you how to keep good records,
- Guide you if your business needs to be registered for VAT, Explain to you about available VAT schemes.
- Provide you a list of possible allowable expense
- Advise you about the tax liability & dates
- Act as an agent on your behalf and deal with HMRC.
- Email and telephone support throughout the year.
- ACCOTAX – Bookkeeping software
- Tax planning
We try to make things transparent for our clients by providing maximum information. If you are looking for low cost fixed fee, Partnership in surrounding areas, please feel free to contact us on 0800 6441 258 or email us on [email protected] – Click here for a Quick Quote
