Personal, Business, and Trust Tax Support

Convert a Sole Trade to Partnership when 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. In Practice Management, create a new Partnership with a new name, trading name, client code, and other static data.
    important
    Do not enter a commencement date.
  2. Add any new partners and their start dates.
  3. In Personal, Business and Trust Tax, select
    File
    ,
    New
    , then
    Partnership
    .
  4. Select the newly created Partnership.
  5. Open the existing Sole Trade and select
    Apply Changes
     from Digita Contact Manager.
  6. Select
    Edit
    , then
    Schedule Editor
    .
  7. Select
    Self Employment
    , then
    Edit
    .
  8. Select the business to convert, then
    Edit
    .
  9. Select
    Change
    .
  10. Select the Partnership created in Practice Management.
  11. 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. 

This article applies to:

  • Product: Digita Personal Business and Trust Tax