½Û×ÓÊÓƵ

A partner can hold land and buildings used by a partnership in three ways. They can:

1. Ìý

   (a)ÌýÌýÌýÌý let the land to the partnership

2. Ìý

   (b)ÌýÌýÌýÌý permit the other partners to share occupation of the land with them, or

3. Ìý

   (c)ÌýÌýÌýÌý hold the land on trust for the partnership so that it forms part of the partnership capital

For the separate property of partners see also I6.221, I6.223.

The grant of a lease in respect of agricultural property to a farming partnership gave rise to difficulties until the passing of FA 1981, because even if a full rent was charged, granting a lease automatically reduced the value of the grantor's estate due to the loss of vacant possession.

FA 1981, s 97 (now IHTA 1984, s 16) made it easier by enacting that the grant of a lease for full consideration is not a transfer of value, although it later emerged that HMRC regarded full consideration as the level of 'tender' rents offered for new tenancies of agricultural land rather