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Flexibility or uniformity?

16 November 2016 / Chris Lallemand
Issue: 4576 / Categories: Comment & Analysis

HMRC’s proposals for partnership taxation.

KEY POINTS

  • Partnerships are an important business structure for the UK economy;
  • HMRC’s August partnership taxation proposals aimed to improve their tax administration;
  • The proposals need refinement to account for practical issues.
  • Areas outside those listed in the consultation should be considered.

 

What is HMRC’s strategy for the taxation of partnerships? Its August consultation on partnership taxation recognises they are flexible vehicles widely used in business and important structures for the investment management industry. The document was issued after recent partnership tax changes such as the FA 2014 salaried and mixed member rules and the changes between FA 2015 and FA 2016 to entrepreneurs’ relief and carried interest. Given the reference in the consultation to ‘unacceptable practices’ one is left wondering whether the August consultation is in part a further tax...

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