½Û×ÓÊÓƵ

Companies in partnership

Produced by a Tolley Owner-Managed Businesses expert
Owner-Managed Businesses
Guidance

Companies in partnership

Produced by a Tolley Owner-Managed Businesses expert
Owner-Managed Businesses
Guidance
imgtext

This guidance note sets out the treatment of corporate partners in a partnership, how any profit or losses are calculated and allocated to the partners and then how they are reported on the corporate tax return.

The insertion of corporate partners, usually as members of a limited liability partnership (LLP), has become a popular structure. This is particularly true following the divergence between corporation tax and income tax rates. For more detail on inserting a corporate partner see the Introducing corporate partners guidance note.

However, targeted anti-avoidance legislation applies to counter planning involving mixed partnerships, ie where a partnership is made up of a mixture of individuals and non-individuals (eg a company). The rules require excessive profits allocated to a company to be reallocated to other individual partners. Excessive losses allocated to an individual partner are also subject to the rules see the Partnership anti-avoidance provisions guidance note for further details.

It should be noted that partnerships may also be impacted by the loans to participators rules for close companies ― see the Loans to participators

Continue reading the full document
To gain access to additional expert tax guidance, workflow tools, and tax research, register for a free trial of Tolley+â„¢
Powered by

Popular Articles

Gifts out of surplus income

Gifts out of surplus incomeA valuable exemption from inheritance tax (IHT) applies to gifts out of surplus income. This exemption applies only to lifetime gifts and is therefore a key part of lifetime planning. The exemption applies to both outright gifts and gifts into trust. Gifts which meet the

14 Jul 2020 11:48 | Produced by Tolley in association with Emma Haley at Boodle Hatfield LLP Read more Read more

Company cars

Company carsIntroductionCompany cars are one of the most common taxable benefits. The rules for calculating the benefit are complex, and the reporting requirements are more onerous than most benefits. Company cars are covered by very specific legislation. Detailed guidance on each of the following

14 Jul 2020 11:15 | Produced by Tolley Read more Read more

VAT registration ― change of VAT registration details

VAT registration ― change of VAT registration detailsVAT registered persons must keep their VAT registration details up to date and notify HMRC of any changes. Failure to notify HMRC by the relevant time could result in a penalty. For guidance regarding penalties for failure to notify please see the

14 Jul 2020 13:57 | Produced by Tolley Read more Read more