General responsibilities

As sole trader or member of a partnership you have to follow the right procedures HMRC has established on running and naming your business (considering general business partnerships of individuals here)

Responsibilities – Sole Trader

  • keeping records of your business’s sales and expenses
  • sending a Self Assessment tax return every year
  • paying Income Tax on your profits and Class 2 and Class 4 National Insurance
  • any losses your business makes
  • bills for products/services you buy for your business
  • registering for VAT if your turnover reaches the VAT threshold
  • registering with the Construction Industry Scheme (CIS) if you’re a contractor or sub-contractor in the construction industry
  • you can use your own name or trade under a business name

Responsibilities – Partnership

  • choose a ‘nominated partner’
  • keeping records of your business’s sales and expenses
  • sending a Self Assessment and Partnership tax return every year
  • paying Income Tax on your profits and National Insurance through Self Assessment
  • any losses your business makes
  • bills for products/services you buy for your business, like stock or equipment
  • registering for VAT if your turnover reaches the VAT threshold
  • you have to report changes in the Partnership such as: partner leaves, joins, dies, go bankrupt, or the Partnership changes name, address, changing the nominated partner or closes.
  • you can use your own name or trade under a business name

These rules are general and not considering other scenarios eg. Limited liability partnerships, or having a limited company as a partner etc.

Comments are closed