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Full expensing available to corporate partners

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The CIOT reports recent changes to HMRC’s Capital Allowances Manual which confirm HMRC’s view that partnerships with corporate partners are able to claim capital allowances which are only available to companies within the charge to corporation tax. This covers, for example, first-year allowances including full expensing that are not available to unincorporated businesses.

This treatment was also confirmed by the Financial Secretary to the Treasury in the Finance Bill 2024 ‘Committee of Whole House’ debates (Commons Hansard, 10 January 2024, Column 349), where he said: ‘a corporate partner is eligible for full expensing, but an unincorporated partner is not.’

Paragraph CA11145 of the Capital Allowances Manual clarifies the position: ‘Partnership members within the charge to Corporation Tax may obtain the benefit of first-year allowances such as full expensing or the super-deduction (which partnership members within the charge to Income Tax are unable to access).’

Issue: 1647
Categories: News
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