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Do I have to claim the money i've sent to a business partner as "friends and family" ?

Discussion in 'Business & Tax Advice' started by BlackHatsFish, Mar 29, 2016.

  1. BlackHatsFish

    BlackHatsFish Junior Member

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    I've sent over $25,000 to this partner of mine via paypal last year and I'm wondering If I have to be the one to claim this money i've sent him?
     
  2. pseudonym

    pseudonym Regular Member

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    "claim" ... you mean to paypal or your country's tax authority?
     
  3. BlackHatsFish

    BlackHatsFish Junior Member

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    Yes sorry for being unclear on that, my country's tax authority.
     
  4. Asif WILSON Khan

    Asif WILSON Khan Executive VIP Jr. VIP

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    You need to speak to an Accountant/Tax Professional.
    It is impossible to give you any sound information with the sparse details provided.
    How is your company set up?
    Where are you based?
    Where are you trading?
    Where did the money come from?
    Seriously, speak to an expert or seek advice from your local Tax office.
     
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  5. Zwielicht

    Zwielicht Moderator Staff Member Moderator Jr. VIP

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    Wilson's correct, we don't have enough information to properly answer this question. Regardless, while I've never worked with a business partner, take this next part with a grain of salt.

    Keep in mind that because I don't know which country you live in, I'm going over this as if you were from the US.

    If your business partner isn't actually part of your company as an employee but rather a hired contractor, you would have to send them a 1099-MISC and report the money as "nonemployee compensation".

    If both of you part of a partnership, then both of you need to report your shares of the profits and losses. https://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Partnerships

    Of course, this information may not even apply to you.
     
    Last edited: Mar 31, 2016