Corporation Tax Act 2010 section 357WBB

Section 357WBA: supplementary

Section 357WBB provides supplementary rules for determining how partners' working time and workforce costs are measured when applying the Northern Ireland workforce conditions for partnerships.

• A "partner" includes anyone entitled to a share of the firm's income, not just formal legal partners
• When measuring a partner's working time at a location, time spent providing services to third parties must be counted if those services result in payments flowing back to the firm
• Two alternative conditions (A and B) determine when third-party service time counts: Condition A requires a payment to the firm from the third party or a connected person; Condition B requires the firm to hold a right acquired from the partner, with payments related to that right made by the third party or a connected person
• Workforce cost deductions for partners are calculated using an arm's length notional consideration — the amount the partner would have been paid as an independent contractor — less any actual payment received outside the partner's profit share