Revenu Quebec Netfile Error: Invalid Partnership Net Income
The Revenu Quebec NETFILE error message: Invalid Partnership Net Income may appear on the spousal return of a business partner when more than four other partners are listed on form TP-80-V, Income and Expenses Relating to a Business or Profession.
In this case, the spouse receiving this error message is not a business partner. Only their spouse with over 4 non-familial business partners is a partner. The spouse receives the error message with a small % and dollar value populated incorrectly on their T2125 form. A spouse with over 4 partners on their return is accepted by Revenu Québec but their spouse cannot netfile even though they should not have a T2125 or partnership income.
To bypass the validation error and file the returns, follow these steps:
Modify the Spouse's Return Who Is Reporting Correctly Business Income
Open the spouse's tax return.
In their business statement, remove the last partner listed.
Change the "Percentage of partnership (%)" for any remaining partner to 40%. This will temporarily bypass the validation error without changing the spouse's income.
File the Taxpayer's Return
Go back to the primary taxpayer's return.
NetFile their T1 and TP1 returns. The submission should now be successful.
Correct and File the Spouse's Return
Return to the spouse's business statement.
Add the partner you previously removed back into the partnership details.
Adjust the partnership percentages to reflect the correct original amounts for all partners.
You can now NetFile the spouse's T1 and TP1 returns (if the spouse's return has not yet been filed, otherwise they can skip this last step)
