Budget 2008 - Associated companies
Date: Wednesday 12th March, 2008
Author: David Mansell
Profile: David Mansell
When looking at whether companies are "associated", the Revenue has historically been able to include the rights of people in partnership.
When looking at whether companies are “associated”, the Revenue has historically been able to include the rights of people in partnership. This has meant that two companies, controlled by people in partnership – but with no other link to one another – could be treated as associated and find that their tax bills rose as a result.
With effect from 1 April 2008, the definition of common control will be revised, so that business partners will only be taken into account where “relevant tax planning arrangements” (put in place to reduce tax liabilities) are in place.
Further detail is awaited, but this presumably means that individuals in “genuine” partnerships will no longer have to include companies owned by their fellow partners when counting the number of associates for their own companies if there is no other commercial connection. If this proves to be the case, it will be a very welcome change.
Keywords: 'The Budget 2008', 'Alistair Darling Budget', 'Budget', 'Budget 2008', 'Budget Day', 'Chancellors budget 2008', 'UK Budget', 'UK Budget 2008', 'UK economy', 'Associated companies' 'Partnerships'
Please note that the opinions expressed in this blog represent the views of the author and not the views of Mercer & Hole.