Account of profits meaning

This table sets out a comparison of the tax treatment for: sole traders; partnerships (for these purposes covering general partnerships, limited liability partnerships (LLPs) and limited partnerships); and companies. It does not take into account any reliefs or exemptions that might be available to specific taxpayers, nor any anti-avoidance provisions that could apply in particular situations. For rates and thresholds in the current tax year, see Practice Note: Key UK tax rates, thresholds and allowances. For further detail on the tax position of each business vehicle, see Practice Note: Forms of business vehicle—tax summary. For more on selecting between business vehicles, see Practice Note: Tax influences on choice of business vehicle. Point of comparison Tax treatment Sole trader: Not a separate taxable entity — the sole trader is taxed personally on their trading activities. Partnership: Not a separate taxable entity — a partner is taxed as an individual on a notional trade reflecting their share of the partnership. Company: A separate...

In this issue: Advertising, marketing and sponsorship Agency and distribution Consumer protection Contracts Contractual joint ventures International Daily and weekly news alerts Dates for your diary Trackers New and updated content Advertising, marketing and sponsorship ASA rulings—19 March 2025 A single complaint was made to the Advertising Standards Authority (ASA) about Haven Leisure Ltd’s claims on holiday pricing. The ASA upheld the complaint. See: LNB News 19/03/2025 11. Agency and distribution Recovery Partners GP Ltd v Rukhadze [2025] UKSC 10 The Supreme Court dismissed the appellants’ appeal against an order to account for profits earned in breach of duty; they were employees of the respondent companies and owed fiduciary duties. The court affirmed strict adherence to the fiduciary ‘no profit’ rule, rejecting arguments for a ‘but for’ causation test and for counterfactual enquiries into whether the gains could have been authorised if consent had been sought. See: Recovery Partners GP...

Lifestyle Equities CV and Another v Ahmed and Another [2024] UKSC 17 What are the practical implications of this case? The Supreme Court has delivered its long‑awaited ruling on the appeal and cross‑appeals in Lifestyle Equities CV v Ahmed, proceeding from Lord Justice Birss’s judgment in the Court of Appeal [2021] EWCA Civ 675. Lord Leggatt wrote for the court, with Lords Kitchen, Lloyd‑Jones, Stephens and Richards agreeing. The judgment sets out a series of significant conclusions: Accessory liability (as a joint tortfeasor) in respect of a strict liability tort is not itself governed by the same strict standard. Conversely, an accessory must possess knowledge of the essential aspects of the tort to justify imposing joint liability on a person who has not themselves committed it. The identical test applies whether accessory liability is said to arise by procuring the tort or by participating in a common design with the primary tortfeasor. An account of profits sought from an accessory will therefore never...

In this issue Trade marks/passing off Copyright and related rights Patents General intellectual property News alerts, daily and weekly Fresh and revised content Key dates for your diary Trackers Latest Q and A Useful information Trade marks/passing off Supreme Court finds directors need not account for profits following trade mark infringement (Lifestyle Equities v Ahmed) In Lifestyle Equities v Ahmed [2024] UKSC 17, the Supreme Court unanimously dismissed Lifestyle Equities’ appeal. It decided the defendant company directors, the Ahmeds, were not liable for procuring Lifestyle’s trade mark infringements, nor under a common design, because they lacked knowledge of the essential facts that made the use of the signs in question, by the company of which they were directors, wrongful. The Court further held the Ahmeds could not be ordered to account for profits made by the company and, on the facts found, had not personally gained from the infringements. Commentary is provided by...

Introduction to the Intellectual Property Enterprise Court The Intellectual Property Enterprise Court (IPEC) sits as a sub-list within the general Intellectual Property List (Chancery Division). It is designed to open up access to justice in IP disputes for small- and medium-sized enterprises (SMEs) that might otherwise struggle to bring or defend a claim. IPEC also serves as a venue for lower-value IP cases to be resolved at proportionate cost, ensuring litigation remains manageable for parties with modest resources. The Intellectual Property List comprises two sub-lists: the Patents Court and the IPEC. It forms part of the Business and Property Courts of the High Court, which were established on 2 October 2017. For further details about the Business and Property Courts, see Practice Note: Business and Property Courts, and for commentary on their introduction in IP matters, see News Analysis: Framework of Business and Property Courts sets ‘solid groundwork for success’. A central feature of the IPEC is robust judicial case management. This is applied using a cost–benefit...

Corporate intangible assets regime — general rule Under Part 8 of the Corporation Tax Act 2009, a company’s profits and losses on intangible fixed assets are taken into account for corporation tax as credits and debits in accordance with the accounting treatment of those assets. In essence, GAAP-compliant accounts form the foundation for determining the taxable and relievable amounts connected to a company’s IFAs. This is often summarised as ‘tax follows the accounts’. There are, however, several exceptions where the corporate intangible assets rules require a departure from the accounting outcome, with IFA credits and debits calculated on a different footing. For broader guidance on the taxation of IFAs, see Practice Note: How intangible fixed assets are taxed—basic principles. Relevant assets One instance where the legislation moves away from relying on the company’s accounts concerns ‘relevant assets’. A relevant asset is: goodwill in a business or part of a business an IFA that consists of information which relates to customers ...

What is confidentiality? This Practice Note outlines confidentiality from the standpoint of an in-house lawyer. It is aimed at banking and finance specialists working within banks and other financial institutions. It flags situations where confidentiality concerns commonly surface for in-house banking and finance lawyers and suggests practical measures to address them. Obligations of confidentiality may arise in numerous forms and settings. This Practice Note concentrates on confidentiality encountered in-house within banking and finance transactions, and does not cover the professional confidentiality duties owed by lawyers (or other professionals). Legal duties of confidentiality can originate from: common law (including the banker’s duty of confidentiality) contractual undertakings statutory protections If a breach is established, the court may grant an injunction (interim or final), award damages or order an account of profits, and require the destruction or delivery up of any physical materials containing the information. Common law obligations of confidentiality Equity recognises a well-established jurisdiction to safeguard confidences where one...

This llp Agreement is dated [ insert date and month ] 20[ insert year ] Parties The persons identified in Part A of Schedule 1 ( Initial Members ); and [ insert name ] LLP, a limited liability partnership (registration number OC [ insert number ]), whose registered office is at [ insert address ] ( LLP ). background [ The LLP was formed under the Act on [ insert date ]. OR The Initial Members plan to incorporate the LLP under the Act on, or immediately following, the date of this agreement. ] The Initial Members enter into this agreement to define the LLP’s internal arrangements and to set out their respective rights, obligations and duties in relation to the LLP...

Case No. [ insert claim number ] IN THE HIGH COURT OF JUSTICE BUSINESS AND PROPERTY COURTS OF ENGLAND & WALES INTELLECTUAL PROPERTY LIST (ChD) [ INTELLECTUAL PROPERTY ENTERPRISE COURT (IPEC) ] Before: Date: BETWEEN: [ insert full name of claimant ] Claimant and [ insert full name of defendant ] Defendant ORDER UPON the trial of action [ insert claim number ] having been held before [ Mr OR Mrs OR Miss OR [ insert other ] ] Justice [ insert name ] on [ insert trial date ]; AND UPON the Court handing down judgment in the action on [ insert date ]; AND UPON the Court determining in favour of the Claimant on its claims for infringement of UK registered trade mark no. [ insert number ] (the Trade Mark) and for passing off; AND UPON the Court finding against the Defendant in relation to its counterclaim for [...

This LLP Agreement is dated [ insert date and month ] 20[ insert year ] Parties The persons named in Schedule 1 (Initial Members); and [ insert name ] LLP, a limited liability partnership (registration number OC [ insert number ]) whose registered office is at [ insert address ] (LLP). background The LLP was incorporated on [ insert date ]. The Initial Members are entering into this agreement to define the LLP’s internal arrangements and their rights, obligations and duties in respect of the LLP...

In financial remedy proceedings, it is usual for one party to earn on a self-employed footing as a sole trader in practice. Instead of using a separate legal personality, for example a company acting as the primary earning vehicle and paying salary and dividends, they trade in a chosen style or their own name and settle personal income tax on profits. Business costs are set off in the ordinary manner, and accounts are normally drawn up for this very purpose. Some sole traders simply run income and outgoings through a personal bank account, while others prefer to operate from a separate, dedicated business account...