Self Employed Paying Tax

superkootoo

Hi Hopefully this is ok in this forum it is the closest I have found.

My DH is going into business with a friend (small carpentry firm- so nothing major in terms of VAT/LTD Company) next year. While both are brilliant at what they do the tax affairs are likely to fall to me and I have been researching/reading and I have mostly got my head around a plan of action. However there is one thing I cant figure out and was hoping some kind individual would shed some light.

I understand a nominated person completes a tax form for the business and each partner also does a self assessment form but does this mean the business pays tax as well?
My husband is employed so his self assessment tax form will be different to colleague who is currently a sole trader.

I am thinking- profits are split and each individual works out their likely tax/NI- saves it up/puts it aside- and pays when asked after filling in the individual self assessment? I am just not sure how the business tax form fits in to this? Or does this just 'prove' profit/loss for the individual self assessments and doesn't mean there will also be a business tax bill?

Sorry for the ignorance- we are booked onto a few business start up courses but these are a few weeks away but getting in some early revision.

00ec25

superkootoo wrote: »

Hi Hopefully this is ok in this forum it is the closest I have found.

My DH is going into business with a friend (small carpentry firm- so nothing major in terms of VAT/LTD Company) next year. While both are brilliant at what they do the tax affairs are likely to fall to me and I have been researching/reading and I have mostly got my head around a plan of action. However there is one thing I cant figure out and was hoping some kind individual would shed some light.

I understand a nominated person completes a tax form for the business and each partner also does a self assessment form but does this mean the business pays tax as well?
My husband is employed so his self assessment tax form will be different to colleague who is currently a sole trader.

I am thinking- profits are split and each individual works out their likely tax/NI- saves it up/puts it aside- and pays when asked after filling in the individual self assessment? I am just not sure how the business tax form fits in to this? Or does this just 'prove' profit/loss for the individual self assessments and doesn't mean there will also be a business tax bill?

Sorry for the ignorance- we are booked onto a few business start up courses but these are a few weeks away but getting in some early revision.

hmm, completing partnership accounts from scratch is not the best place to learn accountancy

- the partnership business declares a profit and files its accounts with HMRC
- the business does not pay tax itself
- the profits are split according to the partnership agreement and each partner declares their own personal tax position on their own personal tax return