I've recently taken on a new partnership client who did not appoint an accountant from the beginning and unfortunately has ended up with a bit of a mess. Not only did they register late for PAYE (this issue has been dealt with), I've now discovered they have done the same thing regarding notifying HMRC of commencement of the partnership.
On appointing me, they advised me the date the business began to trade was 31-10-2011 and provided me with all the UTR numbers, tax returns for the year ended 5th April 2012 where duly issed by HMRC, however, I've now discovered a partnership agreement which states that the partnership shall be deemed to have commenced on 05/11/2010.
I've been advised the reason why the didn't register with HMRC until Oct-2011 is because no actual turnover earned until then. They're involved in Childcare so had a lenghty period between incurring costs to start the business and actually being granted all the necessary permissions to work with children and getting access to premises.
In the first year they only incurred costs to get the business started, there was no actual tax loss to HMRC and therefore, I understand, no penalties will be charged under the new regime. On that basis and as no actual turnover was earned until Oct-2011, would you go through the process of formally notifying HMRC of the late registration in the first place or instead bring in the costs as pre trading expenditure?
Appreciate any comments.