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Correcting Partnership Return

Do I just refile for the prior year?

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Hello all,

Husband and wife (my relatively new clients) were in a 50/50 partnership, which ended on 30/06/2016.  Previous accountant filed the partnership return late for 2016/2017.  On the partnership return they indicated that the two partners ceased being partners on 30/06/2016 but did not put a date in the box saying that the partnership had also ceased on 30/06/2016.   Clients have now received penalty notices from HMRC for the 2017/2018 return not being filed on time.

As the partnership has ceased a return for 2017/2018 should not be due.  However how do I notify HMRC of this?  Do I just refile the partnership return for 2016/2017 including the cessation date and put a note in the white space?

Obviously I / the client will appeal the penalties seperately.

Thanks

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23rd Apr 2019 10:11

Who's going to sign it ?

There are no partners. No-one is eligible to sign.

Send it back uncompleted.

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to lionofludesch
23rd Apr 2019 10:26

Thanks, but send what back uncompleted?

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to Beach Accountancy
23rd Apr 2019 10:38

Beach Accountancy wrote:

Thanks, but send what back uncompleted?

The 2017/18 return.

Presumably one was issued or there'd be no penalty.

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23rd Apr 2019 13:50

Who were the penalty notices addressed to?

Because late filing penalties are applied to the individual partners, not the partnership. If HMRC have been informed that an individual is no longer a partner, those penalties are invalid.

I would be inclined to deal with the penalty appeals and partnership closure in the same letter. Appeal on the grounds that they are no longer a partner, and also point out there are no longer any partners and HMRC should close the partnership record down.

Thanks (1)
to stepurhan
23rd Apr 2019 14:49

The penalty notices were sent to the individual partners.

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to Beach Accountancy
23rd Apr 2019 14:53

They aren't partners.

Just point that out to HMRC - and that you told them so.

Thanks (1)
to lionofludesch
23rd Apr 2019 15:06

In fairness, you do say that the 2016/17 return was submitted late.

The 2017/18 return might already have been issued before the 2016/17 return was filed.

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to lionofludesch
23rd Apr 2019 15:15

Yes, hadn't appreciated that point - the 2016/2017 return was filed in July 2018, the 2017/2018 return would have been issued 06/04/2018.

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23rd Apr 2019 18:33

I'd try calling the Agent line to see if there's any way they'd agree to withdraw the penalties given what you've said so far. I've found a charming person there who is very helpful. Maybe some of his colleagues are too.

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to Moonbeam
24th Apr 2019 13:31

Thanks Moonbeam - that's what I did. A very nice man has closed down the partnership record and cancelled the penalties.

One happy client and one relieved accountant!

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