Partnerships

Question 1

Partnerships: Basic principle

Answer 1

Each partner taxed as an individual

Question 2

Partnerships: Basic steps

Answer 2

1. Adjust profits
2. Deduct capital allowances
3. Split taxable profits
4. Basis periods

Question 3

Partnerships: Basic steps: Final steps if loss

Answer 3

Each P uses best relief personally available

Question 4

Partnerships: Basic Steps: Adjusting profits: What things in particular should be added bakc if the have already been deducted form profit?

Answer 4

1. Salaries
2. Interest

Question 5

Partnerships: Allocating profits: Steps

Answer 5

1. ‘Salary’
2. Interest on capital
3. PSR

Question 6

Partnerships: PSR =

Answer 6

Profit Share Ratio

Question 7

Partnerships: How to deal with changes to profit allocation

Answer 7

TIME APPORTION

Question 8

Partnerships: Basis Period: On-going P

Answer 8

Current year basis

Question 9

Partnerships: Basis Period: New P

Answer 9

Opening year rules

Question 10

Partnerships: Basis Period: Leaving P

Answer 10

Closing year rules

Question 11

Partnerships: Notional Loss: Definition

Answer 11

Pship profit but P loss

Question 12

Partnerships: Notional Loss: Treatment

Answer 12

1, P income treated as nil

2. NL reallocated
   In proportion to actually allocated profits
   (Not PSR)

Question 13

Partnerships: Notional Profit: Treatment

Answer 13

Same as notional loss

Question 14

LLPs: Partners: How are they taxed?

Answer 14

The same way

Question 15

LLPs: Salaried members: How are they taxed?

Answer 15

Treated as employee