16. Partnerships
How HMRC deals with partnerships that become insolvent.
When a partnership becomes insolvent, we may pursue any of the partners for any liability due.
We will lodge one claim with the insolvency practitioner in the name of the partnership. This claim should stand in the joint estate and separate estates of all the insolvent partners. We should therefore be included in any dividend declared in any of the insolvent estates.
Responsibility for submitting and paying returns remains with the solvent partners.
We may lodge a claim with the office holder of the estate of the insolvent partner for any debts accrued up to the date of insolvency.
If you have tax to account for on the administration of the insolvent estate you must not account for it on the solvent partner’s return. We will issue forms to you on request to allow you to account for the tax direct to us.
The office holder will be treated as the taxable person with effect from the date of the winding-up. They will be responsible for submitting and paying any tax due on returns for the period after the date of winding-up.
A claim will be lodged with the office holder in the name of the insolvent partnership for any liabilities due to us up to the date of winding-up.
We will lodge individual claims in the individual estates of the partners calculated from their respective relevant dates.