123ArticleOnline Logo
Welcome to 123ArticleOnline.com!
ALL >> Service >> View Article

Why Do You Need To Lodge The Partnership Tax Return?

Profile Picture
By Author: Tax Return Perth | Tax Accountant Perth
Total Articles: 1
Comment this article
Facebook ShareTwitter ShareGoogle+ ShareTwitter Share

A partnership is generally defined as a group of two or more people who carry on a business together for profits.

Broadly speaking, the net income received from a partnership is calculated as its assessable income; less all allowable deductions. In other words, it is as if the partnership were a resident taxpayer in its own right: with all Australian and overseas’ sourced income and deductions included. The ATO generally considers the payment of a salary to a partner as being a distribution of partnership profits and, therefore, not a tax-deductible partnership expense. This is because a partner cannot legally, be an employee of a partnership, i.e. a person cannot employ him or herself.

A Tax Return must be lodged for the partnership and each partner must also submit an Individual Tax Return. This allows business expenses and deductions to be separated from personal finances.

Some deductions may not be available to the partnership however they may be claimed by individual partners in their return.

You need to take the following steps:

Lodge a Partnership Tax Return ...
... to report the net income. This takes all assessable income into account minus allowable expenses and deductions.
Lodge individual Tax Returns for each partner.
Each partner pays tax on a share of the net partnership income as the partnership itself does not pay Income Tax.

You need to take care when considering a partnership. This business structure is common for small businesses in Australia and there are many advantages for the partners involved. However, the structure is not perfect for every business collaboration. Tax implications can become complicated.

Each partner is then taxed on his or her share of the partnership’s taxable income – or they may claim a deduction for their share of any partnership tax loss. In other words, a partnership itself does not pay tax but is required to lodge a tax return nonetheless.

Tax Return Perth is one of the most highly-regarded tax consultants in Perth.

Total Views: 232Word Count: 319See All articles From Author

Add Comment

Service Articles

1. Finding Your Perfect Electro Etching Solution: A Personal Journey
Author: alexadecock

2. The Best Smm Panel For Instagram, Youtube & More In 2025
Author: yoyomedia

3. Scale Your Social Media Efforts With Yoyomedia
Author: yoyomedia

4. All-in-one Social Media Growth With Yoyomedia
Author: yoyomedia

5. Top Smm Reseller Panel For Facebook & Instagram
Author: yoyomedia

6. Trusted Vet Hospitals In Hyderabad For Dogs, Cats & More
Author: Seven oaks pet hospital

7. Affordable Link Building Services Uk: Maximising Visibility Without Breaking The Bank
Author: Cartoozo

8. The Hidden Costs Of Disconnected Business Tools
Author: Erpone

9. The Future Of Safety: How Aries Oman Is Transforming Security Systems In Oman
Author: Seo Globo

10. 7 Clear Signs Your Business Needs To Move To The Cloud
Author: TechFacto Global Services

11. Swayamvara Parvati Homa – A Vedic Path For Timely Marriage And Marital Harmony
Author: jyotir Gamaya

12. Share Great Memories With Same Day Delivery Rakhi
Author: Anuj

13. Household Goods Moving Services In Hyderabad: Reliable Solutions For Your Relocation
Author: leocargopackers

14. Packing Services In Hyderabad: Professional Solutions For Safe Relocation
Author: leocargopackers

15. Affordable Ecommerce Web Design In Ipoh – Unlimited Pages For Rm 499
Author: vineetha96

Login To Account
Login Email:
Password:
Forgot Password?
New User?
Sign Up Newsletter
Email Address: