One of the changes announced in the Autumn Statement is a proposed "clarification" of the tax treatment of partnerships.
Clarification in legislative terms normally means changing the law to mean what HMRC wants it to mean instead of how the rest of the world interprets it. So the starting point needs to be: “What does HMRC want?”.
HMRC wants to abolish the tax return. Abolish in this context means they want to obtain as much information about your income as possible from the people who pay it to you and put it online for you to check and fill in the bits they don’t already know.
So the partnership changes are to enable HMRC to prepopulate partners’ tax returns. In this context, they make sense. Change one, if a partner is a nominee he needs to disclose to the partnership the identity of the beneficial owner so that the profit-share can be allocated to the beneficial owner, not the nominee. This change is a commercial nuisance as it may require a rethink on structuring, but has no tax effect at all.
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