Mercer & Hole’s Business blog - Partnership Tax
Budget 2008 - Associated companies
Date: 12th March, 2008 | Author: David Mansell | Comments: 0
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...
Partnerships and Capital Gains Tax - clarification
Date: 28th February, 2008 | Author: Cathy Corns | Comments: 0
A Revenue Statement of Practice first published in 1975 sets out how the CGT rules are to apply to partnerships. HMRC has now decided that the statement is deficient, and have recently issued Revenue & Customs Brief 03/08 to “clarify” the position. The specific point at issue relates to assets which are transferred to a partnership by means of a capital contribution. Previously, where no cash or money’s worth was received, the partner would not be treated as having disposed of their asset. HMRC now consider this to be incorrect. Their current view is that there will...
HMRC Enquiries - avoiding disputes and agreeing settlements
Date: 12th July, 2007 | Author: Cathy Corns | Comments: 0
HMRC has recently set out its strategy on tax litigation and settlement - what does this mean for your business? Following the merger of HM Revenue & Customs, the old Inland Revenue appears keen to get its hands on the extra powers previously enjoyed by Customs and Excise. This is clear from HMRC’s latest guidance on its “Settlements and Litigation Strategy”. This sets out the principles HMRC aims to follow for avoiding tax disputes and ...
Help from HM Revenue & Customs?
Date: 2nd July, 2007 | Author: Rachel Haddow | Comments: 2
The Government talk about ensuring that people pay “the right amount of tax”. However, the tax system is so complex that the “right amount” is not always easy to determine. One of the responsibilities of the Revenue is to help people calculate their tax liabilities accurately and they have recently been testing new ways in which they might do this. First came “enabling letters”. These were sent to sole traders, with certain types of businesses being specifically targeted. Revenue research indicated that a significant number of expense claims are incorrect. These letters therefore covered ...
Partnership losses - the impact of the new rules
Date: 16th May, 2007 | Author: Cathy Corns | Comments: 1
The new rules on partnership losses may have been designed to stop avoidance schemes but many "innocent" businesses may also be caught. The changes are wide-ranging and could affect transactions where no actual tax avoidance is involved. Of particular concern is the limit of £25,000.00 per year on the availability of relief on losses from trading partnerships for "non-active partners". The changes apply to conventional partnerships, Limited Liability Partnerships and Limited Partnerships. The key issue is what is a "non-active partner"? Basically a partner who spends an average of less than ten hours a week personally...
