Last year I signed up with an ABN number in partnership paying the fee of $80 for three years etc.

We signed up in a partnership, now since then the other has decided not to bother doing anything so basically I continued to run the company with out him. Now he's coming back saying he has 50% liability due to this single ABN we registered together.

What can I do, and what can I do to prevent such. He hasn't done anything anything and basically said he didn't want to continue (although not in writing)

Thanks!

Probably best to speak with the legal / tax people - that'd be your best bet.

Joel

ok thanks. Any other suggestions?

Partnerships are evil, and now you know

If you we're a corporation, he should have resigned as director and had very little say in what's going on as he would require your vote to allow him to become one again.

Moreover you could have blocked dividends so he got no money from the business and he would simply be an "investor" you could have bought out. Or you could than force him out by canceling his shares too

Don't forget he'd be liable for 50% (if this is his share or whatever his share is) of the income tax payable too so he could be in all sorts of trouble if you made a profit, and he only filed a return based on his group certificate from a paid job with an employer

Once again this has huge implications for yourself too, and you need to seek advise on what you can do to have the partnership agreement canceled and/or have him struck off your partnership ABN. (Note that he is still liable for past income tax obligations when his name was on the ABN).

The ATO doesn't look kindly on partnerships where one party in that partnership has outstanding obligations, and if your ex-business partner didn't lodge his recent return with details of the business income he could be in all sorts of trouble if the ATO catches it.

Well, thank you. We have so far claimed no profit as we are still losing money as do most new companies

Would that change any fact etc?

He'd be entitled to a possible tax credit which could mean he's able to claim a larger Tax refund.

If you want him out, now might be a good time to ask him to leave or request he puts more money in etc.

I'm not aware of the ATO taking action against someone for not claiming something they should have which would have resulted in the Commonwealth having to pay that party money.

Again seek legal advice...

Thanks for that.

We are infact quite young, this was started as our hobby during school. He's just come back saying something about 50% etc, yet we have not claimed profit yet and everything has been coming from my pocket and my time!

Thanks.

What does he want to do? What is he trying to archive at the moment?

From what you indicated you created a partnership, (not a company). You should have have started with a partnership agreement. This would define the percentage each had as part of the partnership.
if he agrees, go to the consumer affairs website and find the form that you can use to change the business from a partneship to sole trader.

Vaughnn

@Spirit Connect
He has all of a sudden come up to me and said he has liability with this company and demands that he owns the 50%.
@VeeBee
I took a look at this site but I could not find the form that allows me to change the business to a sole trader rather than partnership.

Andrew,
On the consumer.vic.gov.au website, find the change of business details form.
If you had an ABN, that is another thing all together.

V

Ah thanks. I only have an ABN, what do I need to do then?

Call the ATO, or seek legal advice.

Probably more legal advice is your best bet first.

Andrew,
In your first post you specified you paid $80 for three years. To me this sounds like you registered a Business Name in Victoria. When you register a Business name you would have specified it as a sole trader or partnership.

To get an ABN is something done via the ATO. The Business Area Phone number for ATO is 132866.

VeeBee