IFM36345 - Disguised fees: Sums arising from 6 April 2015 to 5 April 2016 - Involvement of a partnership in the arrangements

Sums arising from 6 April 2015 to 5 April 2016 - Involvement of a partnership in the arrangements

ITA07/S809EZA(3)(b)

Sums arising from 6 April 2015 up to and including 5 April 2016 must involve at least one partnership in the arrangements to be considered a disguised fee.

Is there a partnership in the ‘arrangements’?

The term ‘arrangements’ has a broad meaning. A fund would include a partnership in its arrangements if there is a partnership, whether or not it is involved in managing the scheme, anywhere within the structure.

For example, the partnership which actually holds the scheme investments, the General Partner Limited Partner (GP-LP), the General Partner Limited Liability Partnership (GP-LLP), or any other entity involved in managing the scheme could meet the requirements.

An arrangement is considered to include a partnership where it includes a foreign partnership or other foreign structure which has the same characteristics as a UK partnership.

Sums arising from 6 April 2016

As the concept of sums ‘arising’ was refined, the need for there to be a partnership in the arrangements was no longer relevant.

The requirement for a partnership to be involved in the arrangements of a scheme was therefore removed from the legislation after this date and need not be considered.