I have an end of year profit, how do I show this as being paid to the partners? Can I transfer that amount to the partner loan to bring that down?
Anybody… Please… I need to submit my tax return today 
For tax purposes it makes no difference whether the money has actually been transferred to the partners or kept in the business bank account, the total net profit of the partnership is treated as taxable income for the partners (divided up in whatever ratio you decide to use). Money you have actually paid out of the business bank account to an individual partner would be tagged as a bank transfer to the relevant partner’s drawing account but it doesn’t affect the tax liability.
Thank you for your reply Ian. I just want to make sure it doesn’t carry over as an asset next time…
This topic was automatically closed after 7 days. New replies are no longer allowed.