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HMRC internal manual

Business Income Manual

Partnerships - computation and assessment: other income: computation of income

S849, S851 Income Tax (Trading and Other Income) Act 2005

Where a partnership has any source(s) of non-trading income (‘other income’) the amount of any income chargeable to Income Tax (or relievable losses) is determined as if the partnership were an individual.

This rule applies regardless of whether the income is taxed income, or untaxed income, and irrespective of the category in which the source of income falls. But it only applies to income, not chargeable gains. The computational rules appropriate to each type of income apply to determine the amount of any such chargeable income (or relievable loss). But special basis period rules apply to the share of ‘other income’ allocated to each partner - see BIM82285 onwards.