INTM489285 - The Unassessed Transfer Pricing Profits Process: Amendment of Partnership or Lloyd's Syndicate Tax Returns
Source: gov.uk (2025-12-04)


UTPP will apply to accounting periods beginning on or after 1 January 2026. This guidance will be updated with detailed examples by 1 January 2026. For earlier accounting periods please use the diverted profits tax guidance at INTM489500 (https://www.gov.uk/hmrc-internal-manuals/international-manual/intm489500)

The representative partner or managing agent can also amend the partnership or syndicate return to more fully reflect the transfer pricing requirement. This brings the unassessed transfer pricing profits into charge to corporation tax at the underlying corporation tax rate. For corporate partners of a partnership this will automatically flow through to the underlying returns, but the effect of any amendment is restricted to the corporate partners. For corporate members of a Lloyd’s syndicate, HMRC will amend the corporate member’s company tax return by issuing a notice.

If the partnership, or syndicate, does not make an amendment to bring these profits into their self-assessment (and there is no other change to HMRC’s view of the unassessed transfer pricing profits) they will remain charged via the UTPP assessment. These profits are restricted from being included in any later HMRC amendment to the return so that they are not subject to double taxation or taxation on the same profits.

There are three possible outcomes of a UTPP investigation at the end of the period for amendments:
- all of the unassessed transfer pricing profits remain assessed at the UTPP rate
- some of the unassessed transfer pricing profits remain assessed at the UTPP rate and the rest are charged to corporation tax at the underlying rate following an amendment to the partnership, or syndicate tax return to partially reflect the transfer pricing requirement
- all of the unassessed transfer pricing profits are assessed at the at the underlying corporation tax rate following an amendment to the partnership, or syndicate tax return to fully reflect the transfer pricing requirement
Example

Partnership XYZ has two partners, Company A and Individual B, each is entitled to 50% of the partnership profits. HMRC finds that the partnership has unassessed transfer pricing profits of £10 million.

HMRC opens an enquiry into the partnership and a preliminary notice is issued, which sets out:
- the designated officer’s best judgement that the partnership has unassessed transfer pricing profits of £10 million
- the return period to which the partnership profits relate
- the designated officer’s best judgement that Company A has unassessed transfer pricing profits of £5 million
- the accounting period to which the company profits relate
- the basis on which the designated officer considers the conditions for UTPP to be met
The partnership does not make any representations and within 60 days HMRC assess Company A on £5 million unassessed transfer pricing profits.

During the period for amendments, the representative partner provides additional information. The representative partner and HMRC agree that there are actually £7 million of unassessed transfer pricing profits, rather than £10 million. The representative partner makes an amendment of £7 million to the partnership statement. This is only taken into account for the calculation of the corporate partner’s profits under CTA09/S1259. The effect of the amendment is to increase Company A’s share of the partnership profits by £3.5 million. This is agreed with HMRC to represent the full amount of the unassessed transfer pricing profits and the UTPP assessment is withdrawn.

At the end of the enquiry there are no other amendments. The closure notice shows no further amendments to the corporation tax statement and an amendment of £7 million to the income tax statement. There is a consequential amendment to Individual B’s self-assessment, increasing their share of the partnership profits by £3.5 million.