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  • RE: Amending a partnership tax return

    Thank you for the prompt reply. I had understood that transitional adjustments are employed when changing accounting methods between tax years. Can you confirm that this approach may still be used to amend already submitted tax returns (i.e. the date of change would be the commencement of trading)? Similarly, the claim for early year losses would apply to our previously submitted personal self-assessment returns. Should both parts of this matter be submitted in writing together? Many thanks for clarifying this.
  • Amending a partnership tax return

    I am not sure if this is the correct forum for this question, or if it should be under business tax. Please bump if appropriate. After being employed for many years, my wife and I recently set up a new business in partnership with each other. We had some pre-trading and year one losses that were reported on the first partnership tax return (2020/21). It was recently pointed out to me that we could have offset the early year losses for the new business against PAYE tax from our last three years of employment (ending years 2018/19 and 2017/18 for my wife and I, respectively). I understand that this is only possible if the new business tax return is on an accruals/traditional accounting basis. Unfortunately, the first return had already been submitted on a cash accounting basis (although I want to restate our year one accounts on an accruals basis, which is more appropriate, as we carry stock). My questions are: 1. Can we amend or resubmit our year one partnership tax return for the business on an accruals basis to claim the early years loss relief on resubmitted personal tax returns? 2. What is the best way of amending/resubmitting both partnership and personal tax returns? Many thanks
  • RE: RNRB under the new IHT/Probate rules (post 1/1/2022)

    Hi. Thanks for the quick response, but I had already contacted them and they were not sure how it should be addressed - hence my post here. Any further suggestions would be appreciated. Many thanks
  • RNRB under the new IHT/Probate rules (post 1/1/2022)

    I should be grateful for some help with a question I have on how to express the use of RNRB for an excepted estate. Background: My mother passed away in January 2022 and I will be applying for probate under the new rules. There will be no IHT to pay and it appears to meet the conditions for a “low value excepted estate” (IHTM06011/12). The gross value of the estate is under £650,000, including a house worth £300,000, which has been left to me. My father pre-deceased my mother and the unused proportion of his NRB equates to £160,000 (allowable now for an excepted estate under IHTM06024 and claimable directly on Probate form PA1 (IHTM06031)). Total NRB reliefs therefore equate to £325000 + £160,000 = £485,000. However, as the house is being left to a direct descendent, RNRB of £175,000 applies, giving total available relief of £485,000 + £175,000 = £660,000. The estate gross value is well within this sum and transferring a brought-forward RNRB allowance from my father is not required. I have used the HMRC inheritance Tax Checker tool which states that IHT is payable as it does not account for RNRB, but it does indicate that I could “claim additional threshold up to £175,000 under residence nil rate band rules.” There is no box on PA1 to specifically claim RNRB and, in fact, IHTM46004 states that “there is no requirement for a claim to be made for RNRB. If the conditions are in point, then it is due automatically”. However, historically, RNRB would have been claimed on IHT435, but this requires the completion of forms IHT400 and others, which makes little sense as no IHT is due and I believe that the new rules are meant to reduce the number of estates required to submit IHT submissions (indeed IHT205 is now specific in saying that it should not be used post 1st January 2022). Questions: Firstly, if I have misinterpreted anything above, please correct me. Secondly, does RNRB need to be claimed on any IHT form? Lastly, if I do not need to claim RNRB in this way, is there somewhere I need to express it on PA1 anyway, and, if so, how? (If I used the outputs from the IHT checker (as PA1 instructs) then this would be patently wrong as it suggests that IHT is due). As many estates must fall into this excepted category with property left to descendants, it would be helpful if there were some specific guidance on this. Many thanks in advance.