BRIGHT-LINE TEST FOR LLPs

摘要

There's no doubt that the partnership tax changes have excited much comment as some partnerships contemplate hurried changes to avoid tax increases. Ministers have concluded that individuals need to make a choice between operating as a company and operating in partnership; aiming for the low corporate rates for part of the profits is no longer acceptable. HMRC has opted for a new bright-line test so we can work out whether someone is truly an equity partner - but only in relation to a UK LLR The three principles are drawn from case law but will have new statutory definitions; to be treated as an equity partner in future just one of the three tests must be satisfied. There isn't a new test for general partnerships, or for foreign LLPs; they keep the case law principles.