The Lloyd’s Underwriters (Scottish Limited Partnerships) (Tax) Regulations 1997

Explanatory Note

(This note is not part of the Regulations)

These Regulations provide for the tax treatment of profits or losses arising to the partners of a Scottish limited partnership from the underwriting business carried on by the partnership as an underwriting member of Lloyd's. The Regulations have effect in relation to accounting periods of Lloyd’s Scottish limited partnerships ending on or after 1st December 1997.

Regulation 1 provides for citation, commencement and effect, and regulation 2 for interpretation.

Regulation 3 makes provision for the operation of the partnership assessment rules in connection with a Lloyd’s Scottish limited partnership (“LSLP”).

Regulation 4 disapplies the cessation provisions for Lloyd’s underwriters in the Finance Acts 1993 and 1994 in relation to a LSLP.

Regulation 5 provides that ancillary trust funds relating to a LSLP shall be regarded as an ancillary trust fund of the partnership irrespective of whether the fund in question was established by the LSLP or by the partners in the LSLP.

Regulation 6 determines the basis of assessment for the profits or losses of a LSLP so far as concerns partners who are individuals.

Regulation 7 disapplies section 175 of the Finance Act 1993 so as to prevent the setting up of a special reserve fund in relation to a LSLP.

Regulation 8 disapplies section 180 of the Finance Act 1993 so as to ensure that the profits of a partner in a LSLP who is an individual are not regarded as earned income.

Regulation 9 makes provision in the event of the death of a partner in a LSLP.

Regulation 10 makes provision in connection with terminal loss relief under section 388 of the Income and Corporation Taxes Act 1988 on the discontinuance of his partnership business by a partner in a LSLP who is an individual.