I have met a prospective client recently. He was a partner in a law firm until 30 April 2023 earning £250 000 a year and had overlap relief of £70 000. He joined his new firm on 1 May 2023 and earned £330 000 in profits in the first year.
Is there any scope to use the option to spread transitional profits under the change of basis period rules here?
Query 20 375– Curious.
Client won’t benefit from spreading.
Curious’ prospective client left one partnership in 2023-24 and joined another the following day. Did this represent a cessation of one trade and the commencement of a new one or a continuation of the same trade? It’s highly likely that HMRC would argue this a cessation and commencement even though we are talking about two law firms. The partnership manual clearly states that a notional trade...
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