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This article applies to:

  • Product: Digita Personal Business and Trust Tax

Convert a Sole Trade to a Partnership when not Integrated in Personal Tax

  • You will need 12 months accounts for the business.
  • The Sole Trade must be a Business Tax self-employment instance.
important
  • Do not enter a cessation date.
  • Do not change the accounting date where a self-employment becomes a partnership or vice-versa part way through the year.
  • Conversions should have effect from the first day of an accounting period.
note
A conversion starting at the beginning of an accounting period may mean that you have a partnership with only one partner for part of a year. If this is the case, your client will only have partnership pages in the year of conversion (despite the fact that they were self employed for part of the period). This is correct and in line with HMRC guidance. You should almost never have both partnership and self-employment pages for the same business in a single return.
  1. You can use two different ways to convert a Sole Trade to a Partnership: the Information Explorer to 'convert' the business, or the Schedule Editor to 'change' the business.
  2. To use the Information Explorer method:
    1. Select
      Business: name of business
       in the Information Explorer.
    2. Right-click
      Business: name of business
       then select
      Convert to partnership
      .
    3. Continue to step 3.
  3. To use the Schedule Editor method:
    1. Select
      Edit
      , then
      Schedule Editor
      .
    2. Select
      Self Employment
      , then
      Edit
      .
    3. Select the business to convert, then
      Edit
      .
    4. Select
      Change
      .
    5. Continue to step 3.
  4. Enter a client code for the partnership.
  5. Enter a new name for the partnership if the name has changed.
  6. Enter the date of conversion.
    note
    This should be the first day of the accounting period in which the change occurred, not the actual date the partner joined.
note
Personal, Business and Trust Tax will add the
End date
 of the last self-employment and first partnership accounts. You can change the
End date
 of the first partnership accounts if you need to.