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Introduction

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A Limited Partnership is a form of investment vehicle used mainly by companies or individuals to secure investment for projects or private equity holdings. 

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These partnerships will contain:

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• A General partner who is responsible for the day to day management and administration of the partnerships investments and assets and has unlimited liability for the partnerships debts and obliigations. 

• Limited partners make investments in the partnership but do not have any responsibility for the day to day running of the firm and their liability is limited to their initial investment in the firm.

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Accounting For VAT

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The General Partner will be the individual or company that will have to register for VAT once they exceed the VAT threshold and will also be responsible for filing VAT Returns and paying VAT on behalf of the partnership.

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The Limited Partners will have no obligations in relation to VAT reporting. 

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The General Partner will typically charge and invoice the Limited Partners for Management Fees for managing their investments / running the business and this will include Output VAT if they are registered for VAT. 

 

The General Partner will also incur cost in relation to managing and administering the partnership.  Some of these costs will include Input VAT which the General Partnership can recover depending on their Partial Exemption Recovery Rate.      

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-Contains public sector information licensed under the Open Government Licence v3.0.

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