Ken Moody considers the sometimes vexed question of whether an activity carried on by two or more persons amounts to a partnership, with special reference to property letting.
Partnership Act 1890, s 1 defines 'partnership’ as:
“ … the relation which subsists between persons carrying on a business in common with a view of profit.”
It goes on to note at section 2 that joint letting of property does not ‘of itself create a partnership’.
Is there a ‘business’?
The first point, therefore, is that for a partnership to exist there must be a business. This is not the same question as whether an activity amounts to trading. ‘Business’ is a wider description than ‘trade’.
The distinction is relevant to the availability of certain capital gains tax
