diff --git a/erpnext/accounts/party.py b/erpnext/accounts/party.py
index 38c69ca7eb9..f2e86ef2b2e 100644
--- a/erpnext/accounts/party.py
+++ b/erpnext/accounts/party.py
@@ -765,11 +765,7 @@ def validate_account_party_type(self):
 
 	if self.party_type and self.party:
 		account_type = frappe.get_cached_value("Account", self.account, "account_type")
-		if (
-			account_type
-			and (account_type not in ["Receivable", "Payable", "Equity"])
-			and self.party_type != "Shareholder"
-		):
+		if account_type and (account_type not in ["Receivable", "Payable", "Equity"]):
 			frappe.throw(
 				_(
 					"Party Type and Party can only be set for Receivable / Payable account<br><br>" "{0}"