Hello and welcome to the site. Thank you for your question.Please clarify for me... when you say "Me and a friend have started a General Partnership and have each done our self assessments and have our UTRs"are you stating that you have not registered for self assessment as a partnership but as sole traders
Is the general partnership in spirit ... how do you split the income for joint ventures at present
We have registered the partnership.
We received a letter from HMRC saying that the partnership has been registered and then we both received individual letters saying that we have both been set up for individual self assessment and both have individual UTR numbers.
This is our first joint venture, we haven't made any money as a partnership yet and only recently have been registered. This is why we after some advice as to how any money we make is split between us and how we each pay tax on it. The fact that we need to sign up as one individual person on this IOS Developer programme has just made us wonder how we legally say that we both earned the money.
I'm really sorry, I don't understand.
I just want to know how me and my partner both take our earnings from money that we have earned as a partnership.
So, we are a General Partnership making an iphone game
We need to sign up to the 'Apple IOS developer programme' to make it available to be sold on ITunes and make money from it.
You can either sign up to the 'Apple IOS programme' as an individual person or as a company. Meaning that either you as an individual are selling the Iphone app or a company is selling the app.
We can't sign up to the 'Apple IOS developer programme' as a company as they do not accept General Partnerships.
So, if my partner signs up to it as an individual person and gives his name as the seller and gives a bank account to Apple. Any money that is made from sales will be paid into that bank account under his name as the seller.
We are both making this app and are both partners, it is just that he is listed as the seller.
My question is how do we share the money between us. If the iphone game makes £10,000 and we each wanted to earn £5,000 from it, how do we do that?
Thanks for your reply, I am still slightly confused so please can you confirm the following:-
We both have PAYE jobs which would continue as normal. Would we show this on our self assessments as well as the earnings from the partnership?
Just to clarify, using the 10K as an example,
If my partner is shown as the 'Apple IOS seller' he would complete a self assessment showing earnings of £10,000 less expenses of £5,000. Those expenses would be paid to me and I would complete my self assessment showing that amount as earnings. Therefore we would both pay tax on our £5.000.
So do we complete one separate form declaring that the partnership has made £10,000 and both sign it?
My partner will then declare on his self assessment that he earned £10,000 with £5,000 of that being expenses. What would these expenses be shown as?
On my self assessment form I would show that I have earned £5,000 from the partnership.
We would then both be taxed on our £5,000.
Is this correct?
Thanks so much for your patience in this matter.
Ok that's great, I assume he would declare the expenses as 'Payment to subcontractor' (me).
Would you advise us to make a signed friends agreement stating that we both earn 50% of any profits made?
I hope this is helpful and answers your question.
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