Federal Law No. 318-FZ dated 10 July 2023 amended the procedure for taxing profits of participants in investment partnerships.
The new law amended Art. 278.2 of the Tax Code in terms of clarifying the procedure for determining the tax base for income tax from participation in a partnership.
Profits and losses from the activities of the investment partnership will be determined separately:
- transactions with securities not traded on the organized securities market and derivative financial instruments not traded on the market;
- for other operations.
In this case, the profit (loss) of a participant in an investment partnership agreement from participation in an investment partnership is determined by the part of the profit (loss) of the investment partnership, determined for the reporting (tax) period by the managing partner responsible for maintaining tax records, in proportion to the share of participation of such a participant in the profit of the investment partnership, in relation to the operations performed, reduced by the amount of expenses incurred.
The participant's share in the profit is determined as the ratio of the amount of the contribution of each participant to the total amount of the contributions of all participants in the investment partnership agreement.
The procedure for determining the profit (loss) of a participant upon exit from the partnership is also determined. Income received by a taxpayer upon withdrawal from an investment partnership or termination of an investment partnership agreement:
- are reduced by the amount of profit of a participant in an investment partnership agreement from participation in an investment partnership previously taken into account when determining the relevant tax bases;
- are reduced by the amount of the taxpayer's contribution to the investment partnership paid by him by the time he left the investment partnership (termination of the investment partnership agreement), and (or) the taxpayer's expenses for acquiring rights and obligations under the investment partnership agreement;
- increase by the amount of losses previously taken into account by the taxpayer when determining the relevant tax bases of losses of a participant in an investment partnership agreement from participation in an investment partnership.
It also establishes the obligation of the managing partner responsible for maintaining tax records to provide partners with information on the share of profit (loss) of the partnership that falls on each of them, for each type of operation.
See Federal Law No. 318-FZ of 10 July 2023 “On Amending Article 24-1 Part One and Article 278-2 Part Two of the Tax Code of the Russian Federation”
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