14 February 2007
Our client is a large professional partnership with UITF40 adjusted income of £6 million, the first tranche being taxable in 2005-06. Unfortunately, there was a partnership split in 2006-07 where four partners left in very acrimonious circumstances.
To provide for the tax arising on the UITF40 adjusted income, a 'UITF40 tax reserve' was created in the partnership's balance sheet and 40% tax was provided against the whole £6 million. The balance of the £6 million (i.e. £3.6 million) was credited to the relevant partners in their respective profit sharing ratios.
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Please reach out to customer services at +44 (0) 330 161 1234 or 'customer.services@lexisnexis.co.uk' for further assistance.
