On 9 August 2016, HMRC published a consultation document proposing a number of changes to the taxation of partnerships. This follows on from the Office of Tax Simplification’s ongoing work on ways to simplify partnership taxation. Comments on the proposals are invited by 1 November 2016.
The proposals include:
- treating partners in partnerships which are themselves partners in an underlying partnership as partners in that partnership (recognition of tiered partnership structures). A nominated partner in the underlying partnership would be required to provide details of all partners (including those partners which, as a result of this proposal, are treated as partners in the underlying partnership) and their share of the profits and losses of the underlying partnership.
- treating all persons listed as partners in the partnership tax return as partners for tax returns. HMRC does not believe that partners who claim to be acting as nominee or agent for someone else can escape taxation as a partner in this way.
The consultation document can be viewed here.