I have a big issue and quite a headache deciding a way to go around the following situation:
A partnership was dissolved on 05/04/2015, and one of the partners decided to go solo under the same company's name (which is fine with the rest) and on 06/04/2015 registered as sole-trader with HMRC.
However there are few bills that partnership paid and which carry on into a new financial year - rent of premises (15/03/2015-14/03/2016), email, website and domain name (20/03/2015-19/03/2016), land line, mobile, electricity, etc. Sole-trader is happy to take all that over.
What is the best way to do that? Does partnership invoice sole-trader for each and every bill that is being carried forward into a new financial year and sole-trader pays? If that is the way to go, what date shall invoices be?
When a partnership is dissolved, should they not be winding up their affairs? I do not deal with partnerships (deliberately), but my thoughts are - how can a dissolved entity issue invoices and receive payment? The winding up of a partnership involves the realisation of the firm's assets, ascertaining and discharge of its liabilities, and the adjustment of accounts between the partners so that the profits can be distributed to them or the losses borne by them in the appropriate shares. Surely there needs to be a line drawn in the sand timewise.
-- Edited by Cheshire on Sunday 19th of April 2015 10:55:00 PM
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
