Knowledgebase Support HMRC Useful links
Knowledgebase home
Tax Return Production
Accounts Production
Practice Management
VAT Filer
CloudConnect
Anti-Money Laundering
Support home
Video Training Guides
NEW

Hot Topics
SimpleStep Guides
Release Notes
Technical
Known Issues

Service Status
Useful Links
MTD for Agents MTD for Businesses What is MTD
Preparation
Agent Services Account
MTD for VAT
MTD for Income Tax
MTD for VAT
Digital Record Keeping
Quarterly Updates
Step-by-step Guide
HMRC's MTD Timeline
TaxCalc's MTD Journey

Advanced Rounding Rules – LLP Loans and Other Debts Due to and from Members

Article ID: 3241
Last updated: 21 Jun, 2022

When Apply advanced rounding rules has been selected, a series of reconciliations and rounding adjustments will be carried out to make sure the rounded closing position, for each Member’s Capital Account (account 7500), matches the rounded opening position in the subsequent accounting period.

When considering the carried forward and brought forward amounts for any Member’s Capital Account, the individual Member capital account postings to accounts 7500 and 7520, along with the individual Members profit shares, are taken into consideration. Where there would be a difference between the rounded total of all the unrounded added amounts i.e. the amounts that would be brought forward, and the total of all the rounded added amounts i.e. what would be carried forward, an adjustment will be made to correct this and ensure that the brought forward and carried forward amounts match.

For Example

Member 1 - capital account

Account Code

Amount

Basic rounding

Advanced rounding

Capital brought forward (7500)

(315.75) CR

(316) CR

(316) CR

Drawings (7520)

200.25 DR

200 DR

200 DR

Members’ remuneration charged as an expense

(62.50) CR

(63) CR

(63) CR

Other division of profit

(62.50) CR

(63) CR

(62) CR ((63) CR + 1 DR)

Unrounded total carried forward

(240.50) CR

Rounded total carried forward

(241) CR

(242) CR

(241) CR

ROUNDING DIFFERENCE

1 DR

Where a difference exists between the two amounts above, adjustments would be made to the rounded amounts to account for this difference.

Rounding adjustments are not applied to the brought forward code itself (7500) or to any accounts which are inactive (they have either no postings and/or an account balance of £nil).

An equal and opposite amount is posted to the Balance Sheet rounding account to make sure the Trial Balance still balances.

The Member to which the rounding difference is allocated can NOT be changed.

See KB3094 - What are Advanced Rounding Rules? for more information.

Article ID: 3241
Last updated: 21 Jun, 2022
Revision: 5
Views: 7
This article was: