Self Assessment (SA100) Advice

Can_You_Dig_It

My wife and I run a small business together and are registered as a partnership for tax purposes. Profit from the business is our only source of income and the share of profits is split 50/50. For the purpose of this post, let’s assume profit for the last tax year was £50,000 in total.

We’ve completed a partnership return and are each in the process of completing self assessment (SA100) returns. On page 1 of the ‘Tailor your return’ section  there’s the question “Was your turnover more than £1,000 in total from all self-employments?” If I reply “Yes” to this, the return goes on to ask me details of my self-employed business and the income it received. I add those details including a figure of £25,000 under the income section. The form goes on to ask me about the partnership and what my share of the profits were, so I declare the £25,000 but then when I get to the end of the form, I find a tax calculation based on a figure of £50,000. In other words, it’s adding £25,000 from self-employment to the £25,000 from my share of the partnership profit when these monies are actually one and the same. If I say “No” to the first question about self-employment, the summary says “You were not self-employed” but I get a tax calculation based on a figure of £25,000, which would be correct. I don’t understand what’s going on. I was under the impression that I need to declare myself as self-employed but don’t seem to able to do this without this doubling of my earnings occurring.

Thanks in advance.

Dazed_and_C0nfused

Can_You_Dig_It said:

My wife and I run a small business together and are registered as a partnership for tax purposes. Profit from the business is our only source of income and the share of profits is split 50/50. For the purpose of this post, let’s assume profit for the last tax year was £50,000 in total.

We’ve completed a partnership return and are each in the process of completing self assessment (SA100) returns. On page 1 of the ‘Tailor your return’ section  there’s the question “Was your turnover more than £1,000 in total from all self-employments?” If I reply “Yes” to this, the return goes on to ask me details of my self-employed business and the income it received. I add those details including a figure of £25,000 under the income section. The form goes on to ask me about the partnership and what my share of the profits were, so I declare the £25,000 but then when I get to the end of the form, I find a tax calculation based on a figure of £50,000. In other words, it’s adding £25,000 from self-employment to the £25,000 from my share of the partnership profit when these monies are actually one and the same. If I say “No” to the first question about self-employment, the summary says “You were not self-employed” but I get a tax calculation based on a figure of £25,000, which would be correct. I don’t understand what’s going on. I was under the impression that I need to declare myself as self-employed but don’t seem to able to do this without this doubling of my earnings occurring.

Thanks in advance.

You start off by saying your only income was from a partnership.

Then mention self employment income.

Which is correct?
Do you think you might be making a fundamental mistake when tailoring your return 🤔

Can_You_Dig_It

My only income IS from the partnership and I likely am making a mistake, which is why I'm here asking for advice. 

I am new to this, so please make allowances for my ignorance. 

All sources I've consulted state that as far as HMRC is concerned I am self-employed and need to declare such but, as stated, I am unable to do this on the return without having to give a figure for self-employed income (which I assumed is my earnings from the partnership). I can't put £0 because I've already answered "Yes" to the "Was your turnover more than £1,000..." question, so I'm stuck!

sheramber

Being a partner is not the same as being ‘self employed’ for your tax return. 

Dazed_and_C0nfused

Can_You_Dig_It said:

My only income IS from the partnership and I likely am making a mistake, which is why I'm here asking for advice. 

I am new to this, so please make allowances for my ignorance. 

All sources I've consulted state that as far as HMRC is concerned I am self-employed and need to declare such but, as stated, I am unable to do this on the return without having to give a figure for self-employed income (which I assumed is my earnings from the partnership). I can't put £0 because I've already answered "Yes" to the "Was your turnover more than £1,000..." question, so I'm stuck!

Are you self employed AND in a partnership?

Or just in a partnership?

poseidon1

Can_You_Dig_It said:

My wife and I run a small business together and are registered as a partnership for tax purposes. Profit from the business is our only source of income and the share of profits is split 50/50. For the purpose of this post, let’s assume profit for the last tax year was £50,000 in total.

We’ve completed a partnership return and are each in the process of completing self assessment (SA100) returns. On page 1 of the ‘Tailor your return’ section  there’s the question “Was your turnover more than £1,000 in total from all self-employments?” If I reply “Yes” to this, the return goes on to ask me details of my self-employed business and the income it received. I add those details including a figure of £25,000 under the income section. The form goes on to ask me about the partnership and what my share of the profits were, so I declare the £25,000 but then when I get to the end of the form, I find a tax calculation based on a figure of £50,000. In other words, it’s adding £25,000 from self-employment to the £25,000 from my share of the partnership profit when these monies are actually one and the same. If I say “No” to the first question about self-employment, the summary says “You were not self-employed” but I get a tax calculation based on a figure of £25,000, which would be correct. I don’t understand what’s going on. I was under the impression that I need to declare myself as self-employed but don’t seem to able to do this without this doubling of my earnings occurring.

Thanks in advance.

Sounds like you could have a benefited from intial tax accountant advice when establishing the partnership and perhaps also allow the accountant to prepare your inaugural partnership accounts and tax returns, until you get the hang of the process.

Can_You_Dig_It

Dazed_and_C0nfused said:

Can_You_Dig_It said:

My only income IS from the partnership and I likely am making a mistake, which is why I'm here asking for advice. 

I am new to this, so please make allowances for my ignorance. 

All sources I've consulted state that as far as HMRC is concerned I am self-employed and need to declare such but, as stated, I am unable to do this on the return without having to give a figure for self-employed income (which I assumed is my earnings from the partnership). I can't put £0 because I've already answered "Yes" to the "Was your turnover more than £1,000..." question, so I'm stuck!

Are you self employed AND in a partnership?

Or just in a partnership?

I'm in a partnership and that's my only form of work and my only source of income but, as I've already said, online sources (which, I acknowledge may not be correct) state that I'm still obliged to declare myself "self-employed".

Here's what ChatGPT has to say:

"If your share of the profits from the business partnership is your only source of income, you would generally answer "Yes" to the question asking if you're self-employed on your Self Assessment tax return (SA100). Here's why:

A business partnership is considered a type of self-employment for tax purposes because you’re jointly running the business and sharing in its profits (and possibly losses).

Even though you are in a partnership with your wife, the way the business is structured means you're still seen as self-employed for tax purposes, and you'll be responsible for declaring your income and paying taxes on it accordingly.

In addition to answering "Yes" to self-employment, you would need to complete the Self-Employment (SA103) supplementary pages of your tax return"

Isthisforreal99

That AI response is nonsence.

Seriously, get yourself an accountant if you can't get beyond page 1. 

DRS1

I am not sure why people are reacting like this.  It is a fair question.  I looked at one of my old tax returns and that had a self employed question which expressly said "Were you self employed (not in a partnership)".  The next question was Were you in a partnership?
In the modern form the words in brackets have gone and I am not sure the explanatory notes are much help.  So it seems reasonable to me for someone to ask if you have to tick the self employed box if you are in a partnership.
Back in the 90s it would have been obvious that you tick No to the self employed question but now? Not so much.

NorthYorkie

Technically, the members of a partnership are self-employed, but what the Revenue mean by self-employment in this instance is where the individual is in business as a 'sole trader', i.e. no in a partnership. On page TR2 of the SA100, under the heading 'Self Employment it says " If you worked for yourself (on your ‘own account’ or in self-employment) in the year to 5 April 2025, read the notes to decide if you need to fill in the ‘Self-employment pages’ (my emphasis).. Therefore, as a partner, you only have to fill in the Partnership pages.