BIM72205 - Partnerships - computation and assessment: not a separate entity for tax purposes
For the purpose of taxing the profit made by a business carried on in partnership, a partnership is not regarded as an entity separate and distinct from the individual persons making up the partnership (ICTA88/S111 (1)).
This is the case even where the partnership, as in Scotland, does in law have legal personality. But for the purposes of taxing third party (agency) income a partnership is treated as a separate entity.
However, some legal obligations and rights remain with the partnership. For instance although income tax is charged on the individual partners rather than on the partnership, the partnership is still required to make a return of partnership income and an allocation of that income between the individual partners. Further the partnership is required to make PAYE and subcontractor returns and is liable for the tax due in respect of the payments it makes as employer or contractor.