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I work LLP and have a question regarding a deferred

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Hi
I work for an LLP and have a question regarding a deferred bonus for an employee.
Using the below example can you confirm the HMRC tax situation for the Partner.
Employee A on 6th April 2015 is given a deferred bonus of £1,000 which is put into a Equity fund on his behalf by the LLP. He will receive the £1,000 (or its then value) on 5th April 2017 if he is still an employee on that date.
For tax year end at 5th April 2016 how is this £1,000 recorded on the Partners tax return?
Submitted: 1 year ago.
Category: Tax
Expert:  bigduckontax replied 1 year ago.
Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question. Here is the rule in Bray v. Best [House of Lords]: 'The case of Bray v Best (61 TC 705), was heard by the House of Lords in 1988. Lord Oliver set out the preferred approach: “The period to which any given payment is attributed is a question to be determined as one of fact in each case, depending upon all of the circumstances, including its source and the intention of the payer so far as it can be gathered either from direct evidence or from the surrounding circumstances.”Lord Oliver’s approach to determining the year that earnings are “for” continues to apply. Section 16 simply confirms the recommended approach.'Following the rule in Bray and Best this will be income in the 15/16 tax year. Delaying the payment by one day would push it into the 16/17 tax tear. I do hope that I have helped resolve your conundrum.
Customer: replied 1 year ago.
Hi Keith, to confirm. For tax year 2015/16 this £1,000 is considered income for the employee and as such is an allowable expense on the partners tax return and the employee pays income tax on it also in tax year 2015/16?thanks
James
Expert:  bigduckontax replied 1 year ago.
It is an allowable expense in the partners' books of account from which their ultimate tax liability will be determined. A bit of semantics, but important as the partnership itself does not render a tax return, only the individual partners. The employees tax liability is in 15/16 if paid on 5 April 2016.
Please be so kind as to rate me before you leave the Just Answer site. James.
Regards
Keith
bigduckontax, Accountant
Category: Tax
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Expert:  bigduckontax replied 1 year ago.
Thank you for your support.

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