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HMRC internal manual

Capital Gains Manual

From
HM Revenue & Customs
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Entrepreneurs’ Relief: disposal of whole or part of business: partnerships

TCGA92/S169I(8) (see CG63975) enables partners to qualify for Entrepreneurs’ Relief upon:

  • a disposal of the whole of their interest in the partnership - by treating it as a disposal of the whole of a business
  • a disposal of part of their interest in the partnership - by treating it as the disposal of part of a business
  • a disposal BY THE PARTNERSHIP of the whole or part of the partnership business - by treating the business as owned by the individual
  • a disposal of partnership assets following the cessation of the partnership business - by treating the business as owned by the individual partner.

An individual may also qualify when their business becomes a partnership.

Additionally relief may be available in respect of an asset owned by a partner personally and used in the partnership business under the associated disposal rules, see CG63995.

But relief will NOT be available for disposals of partnership assets, unless the disposal constitutes the disposal of part of the partnership business, see CG64015+ above.

Disposal of the whole or part of an interest in the assets of a partnership

TCGA92/S169I(8)(b) provides that where an individual disposes of either the whole or a part of his or her interest in the partnership this is treated as a disposal by that individual of the whole or part of the business carried on by the partnership.

An interest in a partnership is a single holding. But a disposal (or part-disposal) of the individual’s interest in one or more particular assets of the partnership, rather than of his or her entire interest in all the partnership assets, does not meet this condition for relief.