CA11145 - General: claims: Capital allowances claims and partnerships

The partnership profits chargeable to tax are calculated in accordance with the tax regime and resident status of its members by applying the rules at ITTOIA 2005/S849 and CTA09/S1259 바카라 사이트“ PM163030.  This includes the claiming of capital allowances, which are claimed by the partnership in the partnership tax return.  The partners each receive the effect of the partnership바카라 사이트™s capital allowances claim through their allocation of partnership profits.

Partnerships 바카라 사이트“ all members subject to Income Tax

For a partnership whose members are all within the charge to Income Tax, the partnership profits for tax purposes are calculated according to Income Tax rules, as though the partnership itself were an individual 바카라 사이트“ a 바카라 사이트˜notional individual바카라 사이트™.  Capital allowances are included as a deduction from income in arriving at those profits, which are then shared with the partners according to the commercial profit-sharing arrangement in force for the relevant period.

Partnerships 바카라 사이트“ all members subject to Corporation Tax (corporate partnership)

For a partnership whose members are all within the charge to Corporation Tax, the taxable profits of the partnership are calculated according to Corporation Tax rules, as though the partnership itself were a company 바카라 사이트“ a 바카라 사이트˜notional company바카라 사이트™.  The computation of profits for the 바카라 사이트˜notional company' can include a claim to capital allowances that are only available to companies within the charge to Corporation Tax, for example first year allowances such as full expensing or the super-deduction, as long as the 바카라 사이트˜notional company바카라 사이트™ meets the required conditions of the allowance.

Mixed partnerships

For a partnership with some members within the charge to Income Tax and some within the charge to Corporation Tax, before the partnership profits are allocated to the members, it may be necessary for the partnership to submit more than one computation, for example one in respect of individual members who are subject to Income Tax and one in respect of company members who are subject to Corporation Tax.  As with the corporate partnership above, the computation for the 바카라 사이트˜notional company바카라 사이트™ can include a claim to capital allowances that are only available to companies within the charge to Corporation Tax.  In this way, partnership members within the charge to Corporation Tax may obtain the benefit of first year allowances such as full expensing or the super-deduction (which partnership members within the charge to Income Tax are unable to access). 

Partnerships with a company member - AIA

A partnership of which a company is a member is not a qualifying person for annual investment allowance (AIA) purposes CA23082.  The computation of profits for the 바카라 사이트˜notional company바카라 사이트™ of a corporate or mixed partnership, and the computation of profits for the 바카라 사이트˜notional individual바카라 사이트™ of a mixed partnership, cannot include a claim to AIA because the partnership is not a qualifying person 바카라 사이트“ CAA2001/S38A.