Partnership taxable profits

Partnership taxable profits

Didn't find your answer?

Hi,

Just completing my first ever partnership return and wanted to know if anyone could help me in confirm if i have the correct method and taxable profits. By the way i will be using made up figures for illustration purposes.

Two partners, has a split 60:40

Business commenced on 18/9/06
Accounting Y/E 30.9.07

Workings:

18/9/06 - 5/4/07 = 200 days
6/4/07 - 30/9/07 = 178 days
=378 days

Adjusted Taxable profits = 8990

Adjusted profit split:

60% @ 5394
405 @ 3596

Basis period
(200/378)*378=4757

here i was stuck and wanted to know do i split the £4757 60:40 creating the over lap profit for each partner, and in the short return 07 what figures do i put in box 4.7 and 4.8 and 4.13.

Any help would be highly appreciated.

regards

bob

Bob

Replies (7)

Please login or register to join the discussion.

avatar
By geoffemtacs
10th Dec 2008 15:43

Don't take it to heart
I think there's just a basic misunderstanding here Bob. Your initial query showed just sufficient knowledge for people to think you were a professional accountant (hell, you knew about overlap profits). In theory this is an accountants' forum so it's an easy assumption to make.

Your question should be a piece of cake to any professional and the thought that there are people claiming professionalism and then having to ask such questions on here was obviously what was getting their goat.

Most people in this forum are happy to provide free help to Joe Public who happens to wander in. Some are a bit up themselves and think we shouldn't. But it would help matters if there were some kind of flag that says 'curious amateur' otherwise some people (such as the posters below) will assume 'incompetent professional' instead.

Thanks (0)
avatar
By bigdave1971
10th Dec 2008 13:15

Ignore the posters
OK Bob, I see their problem ... they don't actually know the answers themselves or can't be bothered to give you a proper reply to a reasonable question.

Let me try and help a little.

The first basis period will be from 18/09/06 to 05/04/07 which as you stated was 200 days giving a taxable profit of £4,757 (£8,990 x 200/378) ... again as you stated.

These profits will be split in the 60:40 partnership ratio (£2,854:£1,903).

That is the 2007 tax return sorted!!

For 2008 as the accounting period is over 365 days only the first 12 months are taxed in this year, i.e. the period from 18/09/06 to 17/09/07.

This is calculated as £8,681 (£8,990 x 365/378) and split £5,209:£3,472.

As the period from 18/09/06 to 05/04/07 has now been taxed twice the taxable amounts for each partner for that period now becomes the overlap profits to be shown on the 2008 tax return and carried forward each year until either the year end is changed or the business ceases.

For 2009 the figures will be the figures for the year ended 30 September 2008.

I hope I have this right, I'm beginning to doubt myself now ... maybe someone will agree with the above or point out my errors.

I hope this helps.

Dave

Thanks (0)
avatar
By sharazn
10th Dec 2008 11:04

If you dont have anything positive to say then please dont comme
Hi,

To all those to managed to make a comment on the partnership issue that i raised.

Firstly, i am not a professional accountant, i am one of the partners in the small business that we run and decided to undertake and attempt the task of completing the partnership return .

and to those who were unhelpful, maybe you should keep your comments to yourself if you are unable to help or contribute to the post. I was merely asking for some assistance, and i gather that is what this forum is for.

A little bit of assistance wouldnt go astray and if i was going wrong some where along the lines, maybe someone would have had the decency to correct me. I dont propose to complete future returns myself and will appoint a professional. oh and please spare me your comments.


Regards

Bob

Thanks (0)
avatar
By User deleted
10th Dec 2008 17:52

Curious Amateur!!! :)
Hi,

I would like to thank Geoff and Dave for your comments and especially Dave for his professionalism in responding to the question itself, and providing an answer to the poorly (hands up) contructed question.


I merely wanted some assistance, and for someone to point me in the right direction, and at the outset i felt individuals were howling at me like hungry wolves , because they "assumed" i was professional and was unfit to do the work.

It is fair to stress that individuals of a non accounting professional background also utilise this website for answers and those that can help should try and direct them in the right way. it als must be said that not all accounting professionals are competent in what they undertake and do a cow boys job, and it maybe fair to assume that the unhelpful comments made by those individuals would put them in the same pool as the "cow boys" that you come across in the accounting field.


Once again i would like to thank dave for your assistance, and Geoff for his comments.


warmest regards

Bob

Thanks (0)
By JCresswellTax
10th Dec 2008 09:13

You clearly don't have a clue
You shouldn't be dealing with Partnerships !!

Nice basis period !!

Thanks (0)
avatar
By User deleted
09th Dec 2008 20:20

Oh Dear
Have to agree with Micky - you need to look to your professional code of conduct and ask if you are fit for purpose here. You seem way out of your depth with what is fairly routine stuff.

Getting help on a forum doesn't quite 'cut it' sorry. Get some training.


Thanks (0)
avatar
By AnonymousUser
05th Dec 2008 21:56

You're in the wrong trade mate
I'd return to playing with roley, muck and scoop if I were you...

...clearly out of your depth here

Thanks (0)