Partners and partnerships

Heading: inserted, on 1 April 2008, by section 19(1) of the Taxation (Limited Partnerships) Act 2008 (2008 No 2).

HG 2 Partnerships are transparent
Look-through in accordance with share

(1)

For the purposes of a partner’s liabilities and obligations under this Act in their capacity of partner of a partnership, unless the context requires otherwise,—

(a)

the partner is treated as carrying on an activity carried on by the partnership, and having a status, intention, and purpose of the partnership, and the partnership is treated as not carrying on the activity or having the status, intention, or purpose:

(b)

the partner is treated as holding property that a partnership holds, in proportion to the partner’s partnership share, and the partnership is treated as not holding the property:

(c)

the partner is treated as being party to an arrangement to which the partnership is a party, in proportion to the partner’s partnership share, and the partnership is treated as not being a party to the arrangement:

(d)

the partner is treated as doing a thing and being entitled to a thing that the partnership does or is entitled to, in proportion to the partner’s partnership share, and the partnership is treated as not doing the thing or being entitled to the thing.

No streaming

(2)

Despite subsection (1), for a partner in their capacity of partner of a partnership, the amount of income, tax credit, rebate, gain, expenditure, or loss that they have from a particular source, or of a particular nature, is calculated by multiplying the total income, tax credit, rebate, gain, expenditure, or loss of the partners of the partnership from the particular source or of the particular nature by the partner’s partnership share in the partnership’s income.

Expenditure or loss previously incurred

(3)

A partner of a partnership may be treated as incurring an expenditure or loss which the partnership incurs ignoring this section, despite the partner not being a partner at the time the expenditure or loss is incurred. This subsection does not allow 2 deductions for 1 expenditure or loss.

Excluded amounts

(4)

Subsection (2) does not apply to the following amounts:

(a)

expenditure or loss that relates to a person entering a partnership by acquiring partner’s interests disposed of by another partner, to the extent to which sections HG 5 to HG 10 do not apply to the partner’s interests:

(b)

supplementary dividends, to the extent to which subpart LP (Tax credits for supplementary dividends) applies:

(c)
[Repealed]

(d)

imputation credits, to the extent to which section LE 6 (Partners in partnerships) applies.

(e)
[Repealed]

Defined in this Act: arrangement, imputation credit, income, partner, partnership, partnership share, supplementary dividend, tax credit

Section HG 2: inserted, on 1 April 2008, by section 19(1) of the Taxation (Limited Partnerships) Act 2008 (2008 No 2).

Section HG 2(4)(c): repealed (with effect on 1 July 2011 and applying for income years beginning on or after that date), on 7 May 2012, by section 76(1) of the Taxation (International Investment and Remedial Matters) Act 2012 (2012 No 34).

Section HG 2(4)(d): amended, on 1 April 2017, by section 133(1) of the Taxation (Annual Rates for 2016–17, Closely Held Companies, and Remedial Matters) Act 2017 (2017 No 14).

Section HG 2(4)(e): repealed, on 1 April 2017, by section 133(2) of the Taxation (Annual Rates for 2016–17, Closely Held Companies, and Remedial Matters) Act 2017 (2017 No 14).

Section HG 2 list of defined terms CTR additional dividend: repealed, on 24 February 2016, by section 243 of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).

Section HG 2 list of defined terms FDP credit: repealed, on 1 April 2017, by section 133(3) of the Taxation (Annual Rates for 2016–17, Closely Held Companies, and Remedial Matters) Act 2017 (2017 No 14).

Section HG 2 list of defined terms rebate: repealed (with effect on 23 November 2010), on 17 July 2013, by section 61 of the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013 (2013 No 52).