UK Website threeway

[FX53]

Hi, I own a UK website that is starting to do quite well.

My partner has invested some money, so too has a friend.

I was wondering if I could alternate the sales button between the three of us IE. 3 sales to my account, then 3 to my partner's account, then 3 to my friend's account.

If so, can we each claim our tax relief individually and could we delay VAT registration until we each hit the VAT reg threshold individually.

Thanks in advance.

 

[Becky]

Sounds like you are in a partnership - defined as 'the relationship which subsists between persons carrying on a business in common with a view to a profit'. There is no need for a written partnership agreement, and there are very few formalities. With regard to tax, each partner is treated as a sole trader, although you are also required to file a tax return for the partnership (but it is not taxed as a separate legal entity). However HMRC will regard the partnership as a whole for VAT purposes, so if the partnership turnover exceeds the limit then you are required to register.

Even if you change the sales button on your website, HMRC are still likely to consider that from a legal point of view you are in partnership together. If you want to formally split things out, then you should seek professional advice - in fact I would recommend you do so no matter how you choose to proceed.