We have recently taken on a client who it turns out had run a pub through a partnership in 2012, the reason this has come to light is that our client has had a late filing penalty of £1600 drop on his mat, turns out the previous accountant hadnt filed the return and it appears still hasn't, looking at the paperwork it also appears that the previous accountant had filed individual returns and put the loss 50 /50 to the partners, unfortunately one had taxable income from elswhere the other did not. My questions are, can I adjust the returns to put 99% loss to one partner and on what grounds can I appeal the penalty. Thanks
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If the penalty is for non-submission, and you admit that the return was not submitted, what makes you think you have grounds for appeal?
Unless they have a fixed sharing agreement, the partners can share profits in any way they see fit, but HMRC may take issue if they try to do it retrospectively.
You've more chance of recovery by suing the accountant.
Partnerships, eh ? No wonder we hardly see them any more.