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HMRC internal manual

Apprenticeship Levy Manual

Mergers, acquisitions and joint ventures: example 6

Joint ventures – 50/50 ownership

In a joint venture partnership, where there are 2 companies who each have a 50% share in a further company, neither company has overall control. A joint venture will have a levy liability if it is liable for the payment of Class 1 secondary NICs. Whether it has the full annual allowance of £15,000 to offset against its liability will depend on whether it is connected to another employer by virtue of the connected rules. For example, where ownership of the joint venture is split 50/50, neither company has overall control of the venture. This means that for the purposes of the levy allowance, the joint venture would not be connected to any other companies that the 2 owners may have, and each company would still be entitled to their own levy allowance. The joint venture will therefore get the full annual allowance of £15,000.