EM7565 - Partnerships: enquiries: concluding an enquiry by partial or final closure notice - examples

Example 1 – Final Closure Notice

An enquiry was opened into the partnership return under s.12AC. Other risks which were unrelated to the partnership were identified in the partners personal return and so separate notice of intention to enquire was given to the partners under s.9A. Once you have decided to close the partnership enquiry, you would

• issue the final closure notice to the nominated partner in respect of the partnership enquiry making the amendments to the partnership return that are required to give effect to the conclusions
• wait for the final closure notice to become final (normally when the appeal period expires, or when any appeal is settled by agreement or determined by the tribunal)
• make consequential amendments to the partners returns to give effect to the amendments made to the partnership return
• issue the final closure notice to the partner in respect of the enquiry into the partner’s personal return; these are the amendments that do not relate to the amendments made to the partnership return.  

Example 2 – Partial Closure Notice

An enquiry was opened into a partnership return under s.12AC. Other risks were identified following a review of each of the partners returns and separate enquiries were opened under s.9A. The partnership receives both trade and non-trade income. You have completed your enquiries into the non-trade matters and intend to issue a partial closure notice. In this case you would

• issue a partial closure notice to the nominated partner in respect of the non-trade income, making amendments to the partnership return that are required to give effect to the conclusions.
• wait for the partial closure notice to become final (normally when the appeal period expires, or when any appeal is settled by agreement or determined by the tribunal)
• make consequential amendments to the partners returns in respect of the partnerships non-trade income to give effect to the amendments made to the partnership return
• when you have later completed your enquiries into the partnership return in respect of the trade income, a final closure notice is issued to the nominated partner, making the amendments required to the partnership return
• wait for the final closure notice to become final (normally when the appeal period expires, or when any appeal is settled by agreement or determined by the tribunal)
• make consequential amendments to the partners returns in respect of the partnerships trade income to give effect to the amendments made to the partnership return
• issue a final closure notice to the partner in respect of the enquiry into the partner’s personal return; these are the amendments that do not relate to the amendments made to the partnership return

Example 3

An enquiry was opened into the partnership return under s.12AC. Other risks which were unrelated to the partnership were identified in the partners personal return and so separate notice of intention to enquire was given to the partners under s.9A. You have completed your enquiries into the partner’s personal matters, but the partnership enquiry is still ongoing.

Only if you are sure that the partnership matters will only give rise to (no amendment, or) an amendment that can be made under s28B(4)

• close the s9a enquiry as normal following EM3800; it’s important that any partial or final closure notice issued makes clear precisely what enquiry you are concluding,
• when you are ready to conclude the matters in the partnership check, follow example 1 or 2 as appropriate.”

These examples assume that you are the officer for both the partnership enquiries and the enquiries into the partners personal returns. Often this is not the case, and the enquiries may be worked by different people. You must ensure you communicate with the other case owner to ensure that any action is coordinated properly. You should also ensure that you utilise the templates which are available in SEEs when sending the notices mentioned above.