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HMRC internal manual

Partnership Manual

HM Revenue & Customs
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Indirect, capital and transfer taxes and other tax obligations: VAT and partnerships: Capital gains: CG Reliefs

As gains and losses on disposals of partnership assets are treated as accruing to the partners, rather than the partnership, any claims for relief must be made by the partners separately.

Guidance on specific issues arising on claims to roll-over relief (under TCGA92/S152) is given at CG61150 onwards. Note that relief is available to partners on their interest in assets owned by the partnership and in assets owned separately by one or more partners but used in the partnership trade, even if rent is paid by the partnership to the partner(s) for that use (SP D11).

Some reliefs apply automatically, for example roll-over relief on the transfer of a business to a company under TCGA92/S162 (often referred to as incorporation relief). Relief under TCGA92/S162 is given when a person other than a company transfers a business as a going concern to a company in exchange wholly or partly for an issue of its shares. Detailed guidance on relief on the transfer of a business to a company is available at CG65700+.

Specific guidance on the application of TCGA92/S162 on the transfer of a partnership business to a company is given at CG65700. Relief is available to individual partners (even if one or more of the other partners is a company) where the whole of a partnership business is transferred to a company as a going concern. The relief is computed separately for each partner.