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| 1. LLP subscribers may be residents outside the UK.
2. You must appoint a minimum of 2 Members (Partners).
3. Members can be corporate bodies or private individuals.
4. A Member can be of any nationality.
5. They have legal identities separate from its members.
6. Individual members are almost totally protected against liability.
7. Management, distribution, etc., are governed by the partnership agreement.
8. A British LLP must have at least two designated members.
9. You have to register with Companies House, the method is similar to registering a company.
10. UK LLP can buy and sell property in the name of the organisation.
 +44 (0) 207.748.3039
+44 (0) 800.081.1510
(0) 870.080.2320
 info@uk-ltd-formation.co.uk |
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- DEAR VISITORS, Welcome to Coddan online UK Limited Liability Partnership (LLP) formation agent. We recommend reviewing this site in its entirety, so that you are knowledgeable of the UK jurisdiction and the powers granted to British LLPs. We will guide you through the process of registering your partnership and establishing your registered identity. Complete and submit an LLP application form. Adequate completion and submission of this form, along with the provision of payment, will enable Coddan to incorporate your proposed LLP within five business days. We will express mail your documents to the mailing address you specify in your incorporation order. If you want to become familiar with the description and the contents of LLP incorporation packages, offered by our company and to find above, what kind of service is included in this or that LLP registration package, to get an idea about the price of annual renewal of the service, and about the general legal requirements to the company incorporation within foreign countries, please, select the package you need from the list, situated below the banner. The information in the banner will be renewed according to the package you've chosen. The Limited Liability Partnerships Act of 2000 created for the first time a British version of the American limited liability company (LLC). Like its America cousin it is governed by an Operating or Limited Liability Partnership Agreement and can be structured in a way to allow non-UK resident individuals, conducting all their business outside of the UK to enjoy the prestige of a genuine British entity without liability to UK taxes. However, it is important to note that tax consequences may be created in the jurisdiction of management and control and/or the fiscal residence of the beneficial owners depending on double taxation treaties and the specific drafting of the Partnership Agreement.
The tax authorities in the United Kingdom have confirmed that the taxation base of a limited liability partnership will follow the procedure operated in the past for partnerships. The Limited Liability Partnership itself will not be liable for taxation on profits arising within the partnership, but the profits will be assessed to tax separately on the individual partners.
A limited liability partnership must be a commercial venture operating for profit. Changes in the tax rules are anticipated to confirm that operation through a limited liability partnership by a charity or in relation to investment in shares or property will not be allowed.
The advantages of operating in this way are that no personal liability falls on a member of a limited liability partnership for the contracts or debts of the limited liability partnership and there is no joint or several liability for the negligence of any other member. The organisation of a limited liability partnership may well, therefore, be a popular vehicle for future use by the professions in the United Kingdom and for international business operated by non-resident partners outside of the United Kingdom. There may well be taxation advantages to be obtained from this route, where multi-national business is being undertaken by an international group of partners.
Please note » The prices payable for the items that you order are clearly set out in the web site. There will be no contract of any kind between you and us unless and until we receive payment from you. We act as your agent in the incorporation of limited liability partnerships and filing of Companies House forms. We are not able to guarantee that any such filing will be acceptable to Companies House, nor are there any contractual obligation upon us to do so. If Companies House rejects incorporation or other filing, we will credit your account with a full refund and the contract between us will be made void. Companies House does not offer a cancellation facility for the incorporation of LLPs or the filing of documents. We will be unable to cancel any such submission on your behalf and will not refund any payment you have made. All prices shown at Coddan Web Site ((www.uk-ltd-formation.co.uk) are in Great British pounds.
Live Help » Live Help is a real time "chat" feature which enables you to interact with a customer service representative without a phone call. Get answers to your questions while using our website. Clicking the "Live Help" button will start an on-line session with one of our representatives. Live Help is currently available during normal business hours. Outside of the above opening hours our business center will be closed. When you click on the button you will see an e-mail form that will allow you to send us a mail with your questions. Live Help is absolutely free! There are no hidden fees. We offer the service as a courtesy to our website visitors.
 A Limited Liability Partnership is Essentially a General Partnership, but Each Partner is not to Liable for Certain Acts of Other Partners. LLP Formation Service From Coddan - £160.00:
At present there are in the order of 600,000 partnerships in the United Kingdom. These encompass the full spectrum of business and industry, for example, retail, construction, manufacturing, hotels and restaurants, health, and estate agents as well as the professions. In contrast to countries such as USA, Australia and Canada, it is not possible in the UK to retain the internal structure of a partnership whilst enjoying limited liability status. As a result partners' personal assets are not protected against claims for which they have no personal responsibility. The objective is to keep the legal framework for business in Great Britain at the forefront of international practice by offering firms the ability to incorporate with limited liability whilst organising themselves as partnerships rather than as companies; whilst at the same time providing safeguards for those dealing with this new form of corporate business. These safeguards include the public disclosure of information about the firm, particularly its finances, and safeguards in the case of insolvency.
It should be stressed that the decision to become an LLP will be a voluntary one, based on commercial considerations. The intention is to offer an alternative choice of vehicle to business. This will help to ensure that Great Britain remains an attractive location for business, allowing GB registered firms to operate competitively with their overseas counterparts. This is seen as of particular value to very large professional partnerships operating in global markets, who might otherwise be tempted to incorporate outside Great Britain.
As a business owner, you will be faced with many important decisions, including what business structure to use in your company formation. While many countries allow the typical structures of sole-proprietorship, partnership, or limited company for business ownership, now you have the ability to form a limited liability partnership. The limited liability partnership is essentially a form of limited partnership with one significant difference. In a limited partnership, general partners are liable for the partnership's debts and obligations whereas the partners in a limited liability partnership are statutorily provided full-shield protection from partnership liabilities, debts and obligations. An LLP comprises members and designated members, full details of which must be filed at Companies House. A British LLP must have at least two designated members and the designated members will be responsible for carrying out the duties which would normally be completed by a director or company secretary of a limited company, for example filing any necessary paperwork at Companies House. Designated members can be subject to financial or other penalties if they default in their duties.
Limited liability partnership - points to consider: all partners enjoy limited liability. Partners can pool their resources and talents. Management, distribution, etc., are governed by the partnership agreement. All partners have apparent authority to bind the partnership to agreements entered into. Limited liability partnerships do not have as much continuity. Under certain circumstances, however, claims for economic loss could be made against individual members who have been negligent. Any such claim would be a civil action outside the contract, as the party would have contracted with the LLP. Limited Liability Partnerships are similar to companies in the respect that they will be required to provide financial information equivalent to that of companies, including the filing of annual accounts. While an LLP must file an informational tax return, its income is passed through to its partners and taxed at the individual partner level, without any income tax assessment at the LLP entity level.
Members of an LLP are afforded the protection of limited liability. There are two notable exceptions to this protection: Insolvency. In the event of the LLP becoming insolvent, members can be required to repay profits (with interest) and other property which has been withdrawn from the LLP within the preceding two years. Such repayment can only be sought if the member knew or ought to have realised that there was no real prospect of the LLP avoiding insolvent liquidation. This test encompasses a subjective and an objective test element and has regard to the member's actual knowledge and belief and the knowledge and belief which would be expected of a similar person carrying on the same function of that member. Personal fault. If an individual member is purported to have been negligent, it may be possible to bring a civil negligence action against that individual. However, the courts have indicated that they would have regard to whether the allegedly negligent advice was given in a personal capacity or whether the LLP assumed responsibility for the advice.
Perhaps the greatest benefit of becoming an LLP is the rule that an LLP partner's personal assets will generally NOT be at risk in the event of a financial disaster resulting from business losses, or errors and omissions or other tortious conduct of an employee or a co-LLP partner. Thus, the LLP law eliminates personal exposure for vicarious tort liability as well as liability for partnership debts and obligations such as bank loans and lease obligations. The LLP law does not, however, change the fact that an LLP partner will still be personally liable for his or her own errors and omissions; whether arising from his or her own acts or failures to act, or negligent supervision of associates and staff. This differs markedly from general partnership law which imposes joint and several liability on general partners for all tortious acts of their co-partners acting within the scope of their actual or apparent authority, and joint liability for all other partnership debts and obligations. Forming a limited liability partnership is similar to forming a limited company. Incorporation is a simple process, which we have tailored to provide an easy route to completion of the necessary formalities. Once you are happy with your decision that an LLP is the correct vehicle for your business venture, simply follow the link below to our LLP order form and submit the information as requested.
An LLP can be incorporated wherever "two or more persons associated with the carrying on a lawful business with a view to profit... have subscribed their names to an incorporation document..." (LLP Act 2000). LLPs are incorporated by registration at Companies House. An incorporation document (Form LLP2) to which the initial members have subscribed must be submitted to the Registrar of Companies along with a registration fee of £95.00. The incorporation document will set out the name of the LLP along with its registered office, as well as the names, full addresses and dates of birth of each member.
The profits of the business of an LLP will be taxed as if the business were carried on by partners in partnership, rather than by a body corporate. This ensures that the commercial choice between using an LLP or a partnership is a tax neutral one. The taxation clauses in the Act are expressed in broad terms so that the existing rules for partnerships and partners will, in general, simply apply to LLPs, and members of LLPs, which are carrying on businesses, as if these were partnerships and partners respectively.
The transfer of an existing business to an LLP will only be treated for tax purposes as giving rise to a cessation of the business of the partnership which is making the transfer if in otherwise identical circumstances a transfer between one partnership and another would do so. The transfer of assets between a partnership and an LLP will only give rise to chargeable gain or capital allowance consequences if, in otherwise identical circumstances, a transfer of assets between one partnership and another would so do. Similarly, Inland Revenue Statements of Practice and Extra Statutory Concessions will apply to LLPs and members of LLPs as they apply to partnerships and to partners.
Administrative set up. UK Limited liability comes at a price: the LLP's annual accounts are in the public domain. LLP's have to provide financial information to Companies House and have to file audited annual accounts which are similar to those of a limited company. The name and profit share of the highest paid member must be included within the filed accounts. Similar to a conventional partnership arrangement, the agreement between members of an LLP remains private. This is in contrast to the Articles of Association of a limited company which must be filed at Companies House and are on the public record. The management of an LLP and the relationship between the partners is more flexible than that of a limited company. Whereas a limited company incorporates the statutory management controls imposed by the Companies Acts and other legislation, an LLP can be managed in almost any way that the members wish.
LLP's and their members are not covered by partnership law (implied by statute and common law) as its applicability is expressly excluded by the LLPA 2000. This means that a limited liability partnership agreement will usually be longer than a similar conventional partnership agreement because it must cover matters which may otherwise be incorporated into the agreement by statute or common law. It is possible for a LLP to exist without any written agreement as the (LLP Act 2000 will impart very rudimentary provisions into the arrangement. However, these minimum provisions will be unsatisfactory for most businesses.
Stamp duty relief on conversion. A partnership which converts to an LLP will be eligible for stamp duty relief on property which is transferred within the first 12 months of incorporation provided that: all of the partners in the existing partnership convert to the LLP; the interest of the original partners in the partnership property is the same under the UK LLP as under the pre-LLP partnership.
Coddan offers UK LLP formation services, including secretarial and nominee-designated partners' services. We have assisted thousands of companies around the world establish and maintain their new or existing business formations. When you're ready to form a corporation or file a limited liability partnership, you can even take advantage of our online services to start the whole process online twenty-four hours a day, seven days a week. When you place an order with us, we receive only your order information - the titles you have selected, quantity, total cost and shipping information. Your credit card data is sent to our credit processors secure server and processed there. We never see your credit card numbers or expiration date. We can offer you the choice of three LLP registration packages to suit your practice requirements and to fit your budget. We do not cut costs on expertise and quality but still maintain a cost effective pricing structure. We can help you, if you need a limited liability partnership (LLP) or limited company. Our UK LLP incorporation packages start at just £160.00.
Coddan' LLP formation service includes: limited liability partnership name chaeck; Form LLP2 is sent to you for signature by all the initial members with guidance notes on the completion of the form. This form should then be returned to us as soon as possible. We will again check the availability of the name before filing the document at Companies House and will advise you if there is any problem.
A limited liability partnership MUST have at least TWO members. If membership falls to only one member and the limited liability partnership continues to carry on business for more than 6 months, then the benefits of limited liability are lost. If necessary we can provide you with a nominee member to fulfil this requirement. Nominee designated partners. The designated partners are responsible for the LLP's statutory filing obligations with the Registrar of Companies (incl. Signed General Power of Attorney).
| Description of service | Annual Cost | Prestigious address within Liverpool
Please note Registered Office address is not to be used for general correspondence, our trade mail service is available for this purpose. | £75.00
| Prestigious address within London
For UK LLPs owned by overseas residents it is a legal requirement to have a UK registered address where official government mail can sent. | £100.00
| Prestigious address within Edinburgh
If you want to be a Scottish registered LLP and governed by Scottish law then you will need a registered address in Scotland. We can provide you with a prestigious address in Edinburgh. | £100.00
| Prestigious address within Cambridge
Your LLP's registered office is available for public viewing over the internet free of charge, this can lead to your address being targeted for junk mail! Use our address and we intercept the Junk for you and you retain your privacy, especially useful if you work from home. | £100.00
| Prestigious address within Manchester
The registered office address must always be an effective address for delivering documents to the limited liability partnership, and to avoid delays it is important that all correspondence sent to this address is dealt with promptly. | £100.00
| Nominee Designated Member (Partner)
Our annual fee for the appointment of a designated partner for LLP: - | £125.00
| Annual Return
Completion of your Partnership's (LLP) Annual Return from: - | £99.00
| Non-Trading (Dormant) LLP Accounts
Preparation of Non-Trading/Dormant LLP Accounts from: - | £60.00
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- What is a LLP (Limited Liability Partnership)?
Historically, lawyers organized themselves as general partnerships. For many years, general partnerships were the only way that lawyers could legally practice together. General partnerships did not need any kind of charter or written constitution, which corporations needed. Companies are required to keep minutes of the meetings of shareholders and the boards of directors. No such documentation burdens exist for general partnerships.
British limited liability partnership (LLP) is a new form of legal business entity with limited liability. Limited liability partnerships are taxed as partnerships but in most other respects they are very similar to companies. They MUST have at least two, formally appointed, designated members at all times. (Designated members are similar to executive directors and the company secretary of a company). If there are fewer than two designated members then every member automatically becomes a designated member. Provided that no business or trade is carried out with or within the United Kingdom and the members are located outside of the United Kingdom then LLPs have no liability for United Kingdom taxation. Basically this is because the limited liability partnership itself will not be liable for taxation on profits or gains, the profits or gains of the partnership will be assessed to tax separately on the individual partners. IF THESE ARE LOCATED OUTSIDE THE UNITED KINGDOM THEN NO UK TAX IS PAYABLE.
An LLP does not have a memorandum or articles of association or a specified management structure. Consequently, in order to avoid potential disputes over the management of the company and the conduct of the members it is important that the members enter into a valid and effective agreement between themselves before the LLP is incorporated. The members agreement should cover the sort of issues dealt with in a normal partnership agreement. Partnership law is expressly disapplied from LLPs and as such it is important that the members agreement is extremely comprehensive. If the members agreement is silent on certain issues there is a provision under the LLP regulations for certain default provisions to apply, but those default provisions would almost certainly be unusuable.
An LLP is also considered to be a 'Legal Person' in its own right, and can operate in the same way as a company in most respects. However the one important difference between an LLP and a limited company is the way in which the profits are taxed, with each MEMBER of the partnership being taxed according to the share of the profits that they receive rather than the LLP paying tax directly on its profits. This structure may offer advantages to non-UK residents.
Can A United Kingdom LLP Be Used For Investment Business Or Property Holding? The Inland Revenue Tax Bulletin Issue 50 confirmed that a UK LLP carrying out a trade or profession will be treated as a partnership for tax purposes. They also state that the guidance does not cover the tax treatment of investment business or property holding for which the LLP structure was not originally intended. Therefore we do not recommend that a United Kingdom LLP be used for investment business until it is clear how the UK Revenue intends to tax such ventures.
How Is A United Kingdom LLP Taxed? The explanatory notes to the first draft of the UK LLP Bill stated that the treatment of an LLP as a partnership and members as partners will apply for all tax purposes. Section 10 of the LLP Act states that where an LLP carries on a "business with a view to profit" the members will be treated for the purposes of income tax, corporation tax and capital gains tax as if they were partners. Section 125 of the 1995 Finance Act has the effect of restricting the charge to tax on a non-resident partner of a United Kingdom partnership to its share of the profits of the business carried out in the UK where the partnership business is carried out partly in the UK and partly abroad. From this we can see that where a non-resident partner receives profits from a UK LLP in relation to a business that is carried out wholly outside the United Kingdom, no UK income tax or corporation tax should arise.
- What is the Difference Between a Limited Liability Partnership and a Limited Company?
The main difference is that a limited liability partnership has the organisational flexibility of a partnership and is taxed as a partnership. In other respects it is very similar to a company.
- Who Can Form a Limited Liability Partnership?
The Act generally allows two or more persons associated for carrying on a lawful business with a view to profit to form a limited liability partnership by subscribing to its incorporation document - Form LLP 2. (In law, "person" includes individuals and companies.) However, English and Scottish limited liability partnerships are not available for all activities such as non-profit making activities.
The new structure is very similar to the American LLC therefore the United Kingdom LLP is a corporate body with a separate legal personality. The LLP must have at least two members in the partnership, which can be resident anywhere in the world. The members can be natural persons or corporate bodies. Like its America cousin it is governed by an Operating or Limited liability partnership Agreement and can be structured in a way to allow non-UK resident individuals, conducting all their business outside of the UK to enjoy the prestige of a genuine British entity without liability to UK taxes. However, it is important to note that tax consequences may be created in the jurisdiction of management and control and/or the fiscal residence of the beneficial owners depending on double taxation treaties and the specific drafting of the Operating Agreement. However, a United Kingdom LLP is very different from a United States Limited Liability Company (LLC) and may therefore not be as attractive to a US law firm operating in the UK. The United Kingdom limited liability partnership is a new form of corporate body, which is now likely to be used for tax efficient international trading and business activity. An overseas limited partnership CANNOT usually register in the UK, as the principal place of business must be in the United Kingdom and an overseas partnership would normally have its principal place of business abroad.
The limited liability partnership (LLP) is a separate legal entity with unlimited capacity so that an LLP can do anything that a natural person could do. It has the ability to enter into contracts and hold property, and will continue in existence in spite of any change in membership. While in law an LLP is separate from its members, its members may be liable to contribute to its assets if it is wound up; the extent of that potential liability is as specified in regulations under the Act (Section 1 (4)). The limited liability partnership's existence as a separate legal entity makes it more closely akin to a company than to a partnership (except insofar as the internal relations are governed by agreement between the members). The Act therefore draws on the principles embodied in the companies' legislation.
As an LLP is a body corporate, Partnership Law will not in general apply to an LLP. Elements of Partnership Law may, however, be applied to LLPs by regulations (Section 15 (c)); such regulations will apply in the absence of agreement as to any matter concerning the mutual obligations of LLP members, or LLP members and the LLP (Section 5 (l) (b)). Care is needed, when an LLP has been established, that the members (who enjoy limited liability behind the Limited liability partnership) do not establish relationships between themselves which would amount to a partnership (under the Partnership Act 1890) in effect running in parallel to the LLP. Clearly any such parallel partnership would not enjoy limited liability. In any dealings with third parties, it should be made clear that the only contracting party is the LLP. The members should avoid in any documentation between themselves any suggestion that there are any mutual agency relations between members; a member's only agency relationship should be as an agent for the LLP. Some advisers consider that, to avoid problems in this area, the use of the term "partner" to describe members should be avoided, and that use of the words "the partnership" or "the firm" to describe the LLP should similarly be avoided.
The LLP's existence as a corporate entity means that the effect of the general law is different from its effect on a partnership. For example, a third party will usually contract with the LLP itself rather than with an individual member of the LLP whereas, in general, a partner contracts as principal and on behalf of the other partners. Should a partner be negligent in work carried out for a client, there will generally be two possible causes of action against that partner: contract and tort. However, because the Limited liability partnership will be a separate legal entity with which the client has contracted, only one action (the tort action) is potentially available against the member.
As regards the management of the internal affairs of the LLP the position is similar to that applicable to partnerships. Members will not be obliged to enter into a formal agreement among themselves and, if an agreement is entered into, there will be no obligation to publish it. As in the case of partnerships, however, there will, in general, be clear advantages in having a formal written agreement between members to regulate the affairs of the undertaking and to avoid disputes between them. The formal procedures needed to establish an LLP, including the need for an application to the Registrar, are likely to encourage the members to set up a formal arrangement before the LLP commences business. The Regulations do, however, include default provisions governing the relationship between the members, which apply where no agreement exists or the agreement does not include provision to deal with a particular issue. The profits of the business of an limited liability partnership are taxed as if the business were carried on by partners in partnership, rather than by a body corporate. This is intended to ensure that the commercial choice between using an LLP or a partnership is a tax neutral one.
LLPs will be subject to the same taxation regime as current partnerships and will still be able to regulate their internal constitution by a confidential partnership agreement. However, the LLP will constitute a separate legal person and third parties will contract with the firm rather than with individual partners. Although partners will be liable for their own acts they will not be liable for the acts of their fellow partners, for which the LLP as a whole shall be liable. We are not in a position to advise on all the US tax consequences of a UK LLP, but it is clear that the US views the LLP as a corporate vehicle for US tax purposes so giving the LLP entirely different UK tax and US tax treatments. For example, a US group investing in the UK and having part of its group in the UK, may find the LLP is able to benefit from the favourable UK tax treatment touched on above whilst ensuring, for US purposes, that certain UK profits would not be taxed in the US until the L.L.P. distributes those profits to the US entities in the group.
Whilst the US and Great Britain tax advantages of the LLP very much depend on the particular circumstances of the relevant corporate group, the LLP is unique amongst UK vehicles in having such a split United Kingdom and US tax treatment and should be considered carefully for any group restructuring. We are now able to register a United Kingdom limited liability partnerships for you. We offer a range of options to help you lodge your LLP at Companies House quickly and easily and ensure you can administer it with the minimum of fuss once it is registered. UK limited liability partnership incorporation is tailored to your own specifications and are registered in less than 120 hours. All you need to do is check that your limited liability partnership name hasn't already been registered and complete the details on the order form. We will then carry out United Kingdom LLP formation as your incorporators. If you ask us to register your LLP for you without of nominee designated partners all you need to do is tell us the name you want to register, on the order form, and send us: Form LLP 2 duly completed; and your remittance, duly completed.
Background to the Limited Liability Partnership Act:
The Limited Liability Partnerships Act 2000 came into force on 6 April 2001 (by virtue of Statutory Instrument no. 3316 of 2000). The main purpose of this new Act is to create a new form of legal entity, the Limited Liability Partnership. An LLP combines the organisational flexibility and tax status of a partnership with limited liability for its members. This limited liability is made possible by the fact that an LLP is a legal person distinct from its constituent members.
The Act empowers the government to apply the provisions of company law and insolvency law, with appropriate modifications, to LLPs. These powers have been used, through the issue of the Limited Liability Partnerships Regulations 2001, as the basis for much of the constitutional structure of LLPs and has enabled safeguards to be put in place for those dealing with LLPs. The safeguards include provision for the public disclosure of information about LLPs, particularly their finance, and provisions dealing with the situation if an LLP should become insolvent.
In general, the Act has effect only in England, Wales and Scotland. In Great Britain businesses are structured mainly as limited companies, partnerships or sole traders. Each of these is subject to different regulatory and tax regimes reflecting their organisation and ownership. The only option for many professional practices, in the past, has been to operate as partnerships, since either the general law or the rules of their professional body denied them the ability to incorporate. Accountancy firms have, for instance, only been permitted to incorporate since 1989. As such professional practices were required to operate as partnerships, they were subject to the legal rules relating to the liability of partners. The Partnership Act 1890 sets out special rules relating to the liability of partners to persons dealing with them: all partners are liable jointly, and in Scotland severally also, with their other partners for all the debts and obligations of the partnership incurred during their membership. All partners are jointly and severally liable for any loss or damage arising from the wrongful acts or omissions of any of their partners (as well as their own) arising in the ordinary course of the partnership's business or with the authority of the partners. When the members are liable jointly and severally for any loss or damage, this has the effect that an injured person may opt to sue one or more of the members separately or all of them together.
These arrangements were generally appropriate when all partnerships were small and the partners were of the same profession working closely with one another. However, unlimited liability for partners has become an increasing cause for concern in the light of: a general increase in the incidence of litigation for professional negligence and in the size of claims: the growth in the size of partnerships (since in a very large partnership not all the partners will be personally known to one another); the increase in specialisation among partners and the coming together of different professions within a partnership; and the risk to a partner's personal assets when a claim exceeds the sum of the assets and insurance cover of the partnership. Although these concerns arise most acutely in very large professional partnerships they are relevant to partnerships generally.
The Limited Liability Partnership goes some way towards addressing these concerns since its members benefit from limited liability, the LLP being a separate legal person. In general the LLP and not its members will be liable to third parties. Proposals that it should be possible in Great Britain to organise a business as an LLP emerged out of a review of the law of joint and several liability. In 1996 the DTI published a feasibility investigation of joint and several liability carried out by the Law Commission. The investigation focused mainly on the joint and several liability of professional defendants, seeking to ascertain whether there was an arguable case for replacing joint and several liability by, for example, a system whereby each defendant might be liable for only a proportionate share of the loss. The DTI took the opportunity to consult on the distinct but related question whether to amend the law in Great Britain to allow Limited Liability Partnerships. This question was asked in the knowledge that the concept of LLPs was well known in some overseas jurisdictions, particularly the USA. Jersey too was working on implementing its own LLP legislation in response to representations from the accountancy profession, with a view to attracting offshore registrations.
In February 1997 the DTI published a consultation paper 'Limited Liability Partnerships: A New Form of Business Association for Professions' (URN 97/597). The response to the paper confirmed that there was a demand for the new vehicle across a wide range of professions, and agreement in principle from those consultees who are potential clients of and providers of capital to LLPs. The paper was followed by the publication of a draft Bill and regulations (URN 98/874) in September 1998. Revised draft regulations were published again for consultation, together with the draft Bill (URN 99/1025) in July 1999. In February 2000 a further consultation document was published concerning regulatory default provisions governing the relationship between members (URN 00/617), and revised regulatory default provisions were published in May 2000 (URN 00/865). The outcome of the various consultations was the enactment of the Act by Parliament in July 2000 and the issue of the Regulations in March 2001.
It should be noted that in the UK, a United Kingdom LLP will normally be taxed as though transparent for taxation purposes so that the profits, losses and gains will be directly attributable to the partners themselves. Whilst the most emotive differences may relate to the public disclosure requirements, the other differences between a UK LLP and US LLC may have a significant financial impact for a new business and the partners when setting up in the United Kingdom. There is also uncertainty how a United Kingdom LLP will be taxed in a foreign jurisdiction as the United Kingdom LLP has a distinct separate corporate legal personality in the United Kingdom. It is therefore possible that some foreign jurisdictions may seek to tax income or profits arising in their country as though the LLP were a body corporate. Great care will then need to be taken if it is desired to operate in the UK through a LLP business vehicle and consideration should be given to using the LLP vehicles available in alternative jurisdictions.
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£ 125.00
This is our most popular package with UK residents, and includes:
The filing and registration of your LLP
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