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Sole-trader to partnership

Is s266 election necessary? Does the sole-trader actually cease trade?

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Hello, so husband trading as sole-trader for one full tax year and at the start of the next tax year introduces his wife as a partner to the business.

I'm trying to establish whether CAA 2001, s266 election is necessary to transfers assets at TWDV?

And if indeed a new business has been started? Would there be comparatives in the accounts? Do I declare a commencement of trade date in the wife's Tax Return?

I'd have thought all of the above apply - i.e. one trade ceases and another commences but I'm now questioning this based on BIM82260: https://www.gov.uk/hmrc-internal-manuals/business-income-manual/bim82260

But does BIM82260 apply where only a partnership (i.e. of two or more persons) already exisits?

Thanks (I hope I've explained my confusion well enough).

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By Portia Nina Levin
18th Jan 2017 10:33

There is no cessation and commencement. There is one continuing business, with nothing to do for capital allowances. Variations of this same question get asked and answered every other week.

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Replying to Portia Nina Levin:
By chewmac
18th Jan 2017 16:27

Thanks PNL.

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