How to file with HMRC partnership tax returns for English or Scottish limited partnerships with non-UK resident

investors using the on-line filing mechanism, for tax years ending on or after 5 April 2012 Background
Since the abolition of dummy Unique Tax Reference numbers (UTRs), Private Equity funds constituted as English or Scottish limited partnerships, which have, amongst their limited partners (investors) non-UK resident entities or individuals, have benefitted from an extended paper filing deadline (31 January rather than 31 October), and have had UTRs allocated to their non-resident investors by HMRC which have not been communicated to either the General Partner (or their tax agents), in their capacity as nominated partner for the tax affairs of the partnership. This special arrangement finished with effect from 31 January 2012, i.e. for the tax year ending on 5 April 2011.

The new arrangement for fiscal years commencing 6 April 2011 On- line filing
In order to file partnership tax returns on-line General Partners or their authorised tax agents need access to their investors UTRs. The arrangements agreed with HMRC are set out below, use an agreed template and involve a two stage process: 1. Does the General Partner have the authorisation from non-UK resident investors to obtain the UTR from HMRC? As the General Partner, or its tax agent has supplied information about the investors name, address etc in connection with the tax filings made under the special arrangement, we would expect that the criteria HMRC need for the release of the non-UK resident investors UTR have been met. The form of the authorisation should request that the investor supply its name and address, and confirm that it is not resident in the UK for tax purposes, as well as confirming the jurisdiction in which it is resident for tax purposes. This will usually be covered by the clause that requires the investor to supply such information as the General Partner may reasonably require in order to enable it to comply with local law and regulation Where the non-UK resident investors have provided this authorisation for the General Partner, as nominated partner, to comply with the tax and regulatory requirements which apply to the partnership and its partners, via the deed of adherence, or similar document, HMRC will supply the investors UTRs to the General Partner or its authorised tax agent, using the process detailed below. The UTR does not provide any confidential information relevant to the partner, and does not indicate that the partner is liable to UK tax; it is the tax reference required by statute to enable the nominated partner to file the partnership tax return. The same authorisation process is required for new funds, or new investors in existing funds but two different HMRC offices will be involved & it is important to apply to the correct office. (More information is given later.)

British Private Equity & Venture Capital Association 1st Floor North, Brettenham House, Lancaster Place, London WC2E 7EN T +44 (0)20 7420 1800 F +44 (0)20 7420 1801 bvca@bvca.co.uk www.bvca.co.uk

2. How does the General Partner or its authorised tax agent obtain the non-UK resident investors UTRs? Since the abolition of the dummy UTR in 2009, General Partners, or their authorised tax agents, have provided details of their non-UK resident investors names, addresses and such other information as may be available to assist HMRC in identifying the entities. This information has been supplied via spreadsheets, sent to CAAT at Long Benton. HMRC have allocated UTRs to the investor entities listed on these spreadsheets, but sometimes the General Partners may not yet been given access to these reference numbers. Where this process has been followed in previous years but UTRs for non-Uk resident investors are not yet available to General Partners or their authorised tax agents, they should write to Coventry Non-UK Resident Partners Team, enclosing a list of relevant existing (ie. those included in the partnership tax return for 2010/11) non-UK resident investors names and addresses on the agreed template, together with a covering letter confirming authority to apply for these UTRs saying specifically I have been authorised to receive the UTRs of the listed non- UK resident limited partner investors. Please also give a contact name and telephone number so that HMRC can let you know if it is likely to take longer than 6 weeks to fulfill your request. The address for General Partners or their authorised tax agents to obtain UTRs for existing non-UK resident investors using the agreed template is as follows & completed spreadsheets, following the template, should be sent by courier: Coventry Non-UK Resident Partners Team FAO Mrs C Leslie HM Revenue & Customs Customer Operations Sherbourne House 1 Manor House Drive Coventry CV1 2TA. Telephone: 02476 508612 For new non-UK resident investors in existing or new partnerships, the process is unchanged & General Partners or their authorised tax agents should supply information to The Central Agents Authorisation Team using the existing templates & guidance: HM Revenue & Customs Central Agent Authorisation Team Benton Park View Longbenton Newcastle upon Tyne NE98 1ZZ This process only applies to non-UK resident partners. UTRs for all UK resident partners must be obtained from the investor or its own tax agent. Transitional arrangements for existing funds whose LPAs or investors do not authorise their General Partners to adopt this process, or there are other, short term, issues moving to online filing.

British Private Equity & Venture Capital Association 1st Floor North, Brettenham House, Lancaster Place, London WC2E 7EN T +44 (0)20 7420 1800 F +44 (0)20 7420 1801 bvca@bvca.co.uk www.bvca.co.uk

There may be issues moving to online filing including funds whose General Partners do not consider that their existing documentation authorises them to obtain their investors UTRs, or whose investors refuse to grant such permission when asked. In order to ensure that the tax returns for such funds can be submitted in a timely manner to HMRC, the existing process (where UTRs will be allocated to non-UK resident partners but not communicated to General Partners) will continue. A further (final) transitional filing extension to 31 January will remain until 31 January 2013 but will end at that date From 31 October 2013 therefore paper returns in this instance will be accepted by HMRC provided they are filed with the Coventry Non-UK Resident Partners Team on or before 31 October after the end of the tax year.

British Private Equity & Venture Capital Association 1st Floor North, Brettenham House, Lancaster Place, London WC2E 7EN T +44 (0)20 7420 1800 F +44 (0)20 7420 1801 bvca@bvca.co.uk www.bvca.co.uk