Taxes Consolidation Act 1997 section 1010

Capital allowances and balancing charges in partnership cases

Section 1010 sets out how capital allowances and balancing charges are allocated among partners in a partnership for the purposes of charging each partner's several trade.

• Each partner receives their appropriate share of the partnership's capital allowances (the joint allowance) and is liable for their appropriate share of any balancing charge (the joint charge), both determined by the inspector.
• Joint allowances and joint charges are apportioned between partners according to the profit-sharing ratios in effect during the relevant trading period, after deducting any fixed entitlements such as salaries or interest on capital.
• Where a partner's assessment is insufficient to absorb their share of joint allowances, the unused allowances cannot be carried forward individually but must instead be aggregated and re-apportioned as a joint allowance in the following year.
• The precedent partner claims the joint allowance on behalf of all partners through the partnership return filed under section 880, and that claim is treated as a claim by each individual partner for their appropriate share.