Finance (No. 2) Act 2023

Recovery of partnership payment and effect for tax purposes etc U.K.

[F1 37B (1) This paragraph applies where a partner of a member of a multinational group that is a partnership (the “payer”) makes a payment in respect of the liability to pay multinational top-up tax of the partnership (whether or not in consequence of a partnership payment notice).

(2) The payer may recover the amount from the other partners.

(3) In calculating the payer's income, profits or losses for tax purposes—

(a) the payment is not allowed as a deduction, and

(b) the reimbursement of any such payment is not to be regarded as a receipt.

(4) The payment or its reimbursement—

(a) is not (otherwise) to be taken into account in calculating the profits or losses of for corporation tax or income tax purposes of either the payer or the other partners, and

(b) is not to be regarded as a distribution for income tax or corporation tax purposes.

(5) The amount paid by the payer is to be taken into account in calculating—

(a) the amount of multinational top-up tax unpaid by the partnership, and

(b) the amount due by virtue of a partnership payment notice relating to the amount unpaid.

(6) Similarly, any payment by the partnership or by any of the other partners of any of the amount unpaid is to be taken into account in calculating the amount due by virtue of a partnership payment notice (or by virtue of any other partnership payment notice relating to the amount unpaid).

(7) In this paragraph, “for tax purposes” means for the purposes of income tax, corporation tax, multinational top-up tax or domestic top-up tax.]

Textual Amendments

F1 Sch. 14 paras. 37A, 37B and cross-headings inserted (22.2.2024 with effect for accounting periods beginning on or after 31.12.2023 in accordance with Sch. 12 para. 1(2) of the amending Act) by Finance Act 2024 (c. 3), Sch. 12 para. 2(6)(b)