Partnerships: Operation of ships
Strategic and commercial management
As described in TTM03001, a qualifying company is defined as a company that is within the charge to corporation tax, and operates qualifying ships that are strategically and commercially managed in the UK (FA00/SCH22/PARA16(1)(c).
But a company that operates ships through a corporate partnership does not operate them, it only shares in the operation of those ships. There is therefore a relaxation of the strategic and commercial management rule for ships operated through a corporate partnership to reflect that fact.
Only a proportion of the ships operated by the partnership must be strategically and commercially managed in the UK. That proportion is the same as the share that the tonnage tax company has in the total partnership property.
For example, say a UK company has a 50 per cent share in a corporate partnership with a non-resident company, so that it would be entitled to 50 per cent of all partnership property in the event of a dissolution. In such a case only 50 per cent of the total tonnage operated by the partnership has to be strategically and commercially managed in the UK in order for the UK company to pass the strategic and commercial management test.
|FA00/SCH22/PARA16 (1)(c) (strategic and commercial management)||TTM17086|
|SI00/2303/REG9 (5) & (6) (relaxation for partnerships)||TTM18009|
|Operation of ships||TTM13100|
|Strategic and commercial management||TTM03800|