PTP PTR/TR - Partnership entries for Basis Period Reform without any change of Accounting Period

kba-03848

PTP PTR/TR - Partnership entries for Basis Period Reform without any change of Accounting Period

31st May 2024

Under the Basis Period Reform measures, all businesses' basis periods will be aligned to the tax year and all outstanding overlap relief will be given on transition to the tax year basis.

If the business already has an Accounting Period year end between 31st March and 5th April there is no change required.  If the business is retaining the original Accounting Period year end, the following describes the data entry required in PTP Tax Platform.  (If the Accounting Period year end is also changing as a result of Basis Period Reform please see https://www.iris.co.uk/support/knowledgebase/kb/kba-03846/).

This example relates to a December year end so accounts will be produced for the 12 months from 01/01/2023 to 31/12/2023.  The following is the data entry required for a 2023-24 returns.

1. The Partnership Accounting Period is entered as 01/01/2023 to 31/12/2023

2. All data entry should relate to the standard accounting period.  In this example there is a profit of £24000 for the 12 month period.

3. If there is only Trade income a new tick box will appear in the screen to allocate the income to the partners (please note this tick box was introduced in the May release, 24.1.231, and will only appear if the software would ordinarily default to the short pages on the Individual return).

4. The Basis period end date is the end of the tax year 05/04/2024.

5. The transition portion of the profit is entered in box 16.1.

6. Any overlap relief to be deducted is entered in box 16.2. (Please note if the overlap relief b/fwd is higher than the transition profit, the higher figure should be entered here and the software will automatically utilise the remainder against the standard part of the profit.)

7. Box 16.3 must be a minimum of 20% of box 16.1 minus box 16.3, but a higher figure could be entered if desired.

Within the Tax Calculation Summary, the Standard Profit and Transition Profit will show in separate places.  Only the Standard Profit will be listed in the Income section at the top.  The Transition Profit shows as part of the tax calculation breakdown below.