Taxation of Partnerships

Contents

1. Glossary

2. Introduction

1. 2.1. Overview

   2.2. Purpose of this guide

   2.3. Who should read this guide?

   2.4. How to use this guide

   2.5. Legislative references

   2.6. Status of this guide

3. Overview of partnerships

1. 3.1. What is a partnership?

   3.2. Incorporated partnerships

   3.3. Unincorporated Partnerships

4. Unincorporated Partnerships for Corporate Tax

1. 4.1. Overview

   4.2. Who can be a partner in an Unincorporated Partnership?

   4.3. Key features of an Unincorporated Partnership

   1. 4.3.1. Liability of the Unincorporated Partnership and its partners for Corporate Tax

      4.3.2. Partnership deed/agreement

      4.3.3. Distributive share of partners

      4.3.4. Capital contributions by partners

      4.3.5. Payments to partners

      4.3.6. Dissolution of partnership

5. Unincorporated Partnerships and Corporate Tax

1. 5.1. Unincorporated Partnership treated as fiscally transparent

   1. 5.1.1. Where a partner is a natural person

      5.1.2. Where a partner is a juridical person

      5.1.3. Mixed partnership

   5.2. Unincorporated Partnership treated as fiscally opaque

   5.3. Determining Taxable Income for an Unincorporated Partnership and its partners

   5.4. Income received by the Unincorporated Partnership and/or its partners

   1. 5.4.1. Investment income received by an Unincorporated Partnership and its partners

      5.4.2. Distribution of profits by Unincorporated Partnership to its partners

      5.4.3. Transfer of partner's distributive share in an Unincorporated Partnership

   5.5. Deductible expenditure

   1. 5.5.1. Expenditure incurred for Business purposes

      5.5.2. Interest expenditure

      5.5.3. Interest paid to partners on their capital contribution

      5.5.4. Interest paid to partners on loan advanced by partners

      5.5.5. Interest expenditure incurred by partners to fund capital contributions

      5.5.6. Salary paid to partners in an Unincorporated Partnership

      5.5.7. Payment to partners for services provided to an Unincorporated Partnership

      5.5.8. Reimbursements of expenditure to partners

   5.6. Tax Loss relief and limitation on Tax Loss carry forward

   5.7. Foreign Tax Credit

6. Application to be treated as Taxable Person

1. 6.1. Application and timing of change in status to Taxable Person

   6.2. Other Corporate Tax consequences of being treated as a Taxable Person

   6.3. Whether an application to be treated as a Taxable Person can be revoked

   6.4. Procedural aspects

   6.5. Implications of partners following different methods of accounting

7. Corporate Tax compliance obligations

1. 7.1. Corporate Tax registration

   1. 7.1.1. Fiscally transparent Unincorporated Partnership

      7.1.2. Fiscally opaque Unincorporated Partnership

   7.2. Tax Returns

   1. 7.2.1. Fiscally transparent Unincorporated Partnership

      7.2.2. Fiscally opaque Unincorporated Partnership

   7.3. Tax Periods

   1. 7.3.1. Fiscally transparent Unincorporated Partnership

      7.3.2. Fiscally opaque Unincorporated Partnership

   7.4. Financial Statements

8. Tax treatment of Foreign Partnerships