EM7560 - Partnerships: enquiries: concluding a partnership enquiry

TMA70/S28B

If you have completed your enquiries into a ‘matter’ that you have checked, but you have not yet completed your enquiries into the entire return, it may be possible to issue a partial closure notice in respect of that matter, see EM7561.

An enquiry into a partnership return is completed when a final closure notice is given to the nominated partner (or their successor) to tell them that the enquiry is complete. The notice must state our conclusions and amend the partnership return to reflect the conclusions.

When concluding an enquiry into a partnership return, it’s important to remember that partners and partnerships are each required to submit a return and that the two sorts of returns are separate and distinct. The procedure for settling enquiries into the different returns have many similarities but there are some key differences as the partners are liable to pay any additional duties whereas the partnership does not have a liability.

When you amend the partnership return, consequential amendments must be made to each of the partners returns to give effect to the amendments made to the partnership statement. The consequential amendments change the individual partners self assessments.

Interaction between an enquiry into the partnership return and the partners return

The returns of the partnership and partners are closely linked. The returns may be dealt with by different officers who should maintain good communication with each other. Action in one enquiry could impact on and prejudice the working of the other enquiry. You should not formally conclude any matters relating to the partners’ returns whist there is an ongoing enquiry into the partnership return (or the enquiry window for the partnership return is still open). If you wish to complete an enquiry into the partners return, you should firstly check with the officer dealing with the partnership enquiry.

You may encounter situations where a partner’s personal return needs to be amended as a result of the enquiry into their return and also as a result of the enquiry into the partnership return (as consequential amendments must be made to the partners return to give effect to the amendments made to the partnership return).

The order in which you issue the closure notices completing the enquiry into the partners personal return and the partnership return will depend on the specific circumstances of the case. Sometimes, the partnership enquiry will be completed, and the partnership return finalised before you are able to conclude your enquiries into the partner’s personal return. At other times, the opposite may be true.

It’s important that any partial or final closure notice issued makes clear precisely what enquiry you are concluding. You should use the templates which are available on SEEs.

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