Beta This part of GOV.UK is being rebuilt – find out what beta means

HMRC internal manual

Partnership Manual

Calculating the taxable profits: overriding principle on payments to partners

You need to examine payments made by a partnership to a partner to decide if it is an expense of the partnership or a distribution of profits. Amounts paid to partners represent part of the profits divisible between all of the partners unless they are shown to be made wholly and exclusively for the purpose of the partnership business. For example, payments towards a partner’s personal expenditure will represent a distribution of profits. There is much case law on this topic and further guidance can be found at BIM38120.