Partnership Tax Return

A partnership income tax return informs the tax authority of your partnership’s net income – which is its assessable income less allowable deductions and expenses. It’s required to be lodged if you carry on a business jointly with someone else.

No, a partnership is not a separate legal entity. However, in order to operate your business as a partnership, the partnership must have its own Tax File Number (TFN) and Australian Business Number (ABN). It must also lodge a partnership income tax return.

Profits are distributed to each partner in accordance with a partnership agreement. Each partner then separately reports their share of partnership profits on their individual tax return, and pays tax at their individual tax rate.

A family partnership occurs where two or more partners are related. There are record keeping requirements in relation to family partnerships for tax return purposes. You must document the family relationship of the partners and in a husband and wife partnership, the nature and extent of services provided by each person.

There are some deductions that can be claimed without receipts.

For deductions that require substantiation, registered tax agents such as POP Business can work with you to figure out whether there may be alternative ways to evidence those items.

You could be given a failure to lodge on time penalty. For a small entity, the penalty is one penalty unit (currently $222) for every 28 days that the return is outstanding, up to a maximum of five penalty units.

If you receive a penalty notice, a registered agent such as POP Business can request remission either in full or in part on your behalf, if there are mitigating circumstances.

To lodge prior year partnership tax returns, start by talking to the ATO so you can determine what’s outstanding and if they have already collected some income details through your partnership tax file number.

A registered tax agent such as POP Business can help with this by liaising with the ATO on your behalf. We can also show you how to prepare a partnership tax return based on the relevant rules for the tax year(s) in question.

A registered tax agent such as POP Business can help you:

• Identify what should be included on the partnership tax return
• Understand how to fill out partnership tax return correctly
• Ensure lodgement by the partnership tax return due date
• Maximise your tax refund by identifying deductions and business reliefs you’re legally entitled to

Our professionals can explain how to do a partnership tax return using relevant partnership tax return examples, and through plain language without technical jargon.

The Australian government introduced economic measures to support businesses in response to the coronavirus pandemic. Changes to the instant asset write-off and measures like JobKeeper payments may impact your partnership income tax return.

POP Business can work with you to ensure you file your partnership tax return correctly while maximising business reliefs.

During the year, a partnership may change if a new partner is admitted and/or a partner retires.

For tax purposes, the partnership formed as a result of the change must lodge one partnership tax return covering the whole income year. The return must include distributions made to every partner during the year – even those who left the partnership. There are also additional partnership details required by the ATO.

The partnership doesn’t pay income tax on the profit it earns – each partner reports their share of the partnership income and pays tax accordingly at the individual tax rate to lodge the tax return.

If you lodge the partnership tax return yourself, it is due by 31 October. 

If you lodge through a registered tax agent like POP Business, your due date will generally be between March to May. Please get in touch for the exact due date.

Partnership tax returns start at a low $500. 

Pricing will increase based on the size and complexity of your business. Our pricing is all competitive and have been priced to be an affordable option for small businesses.

Yes. You can find POP Business’s office smack-bang in the heart of Surry Hills, in Sydney. Suite 3, 2/2/12 Foveaux St, Surry Hills NSW 2010 (open in Google Maps).