Corporation Tax Act 2009 section 1267

Various rules for trades and property businesses

Section 1267 sets out how adjustments arising from a change of accounting basis are calculated and allocated when a trade or property business is carried on by a partnership (referred to in the legislation as a "firm").

• When a firm changes its accounting basis, any resulting adjustment is calculated as if the firm were a single UK resident company, rather than being calculated separately for each partner.
• Each partner's share of any adjustment amount brought into account as a receipt is determined by the firm's profit-sharing arrangements for the 12 months ending immediately before the date the new basis was adopted.
• A change in the partners carrying on the trade or property business does not prevent the change-of-basis rules from applying, provided at least one company partner continues in the partnership after the change.
• The normal partnership profit and loss allocation rules in sections 1259 to 1264 are disapplied to the extent that the change-of-basis calculation and sharing rules in this section apply instead.