Is your business a Limited Liability Partnership (LLP)?
A LLP has a number of tax considerations for the individuals who are members. They provide the flexibility of a partnership with the limited liability of its members. They are popular with professional entities and must be distinguished from an ordinary partnership and a rare limited partnership.
Generally, partnerships are seen to be ‘transparent’. Tax is not payable by the partnership itself, but by each member. Each partner’s share of the partnership income is added to their taxable income and therefore, tax is paid on the total of his or her earnings. This includes their share of the partnership profits. Also capital gains are apportioned to each partner.
However, there are a number of tax considerations for LLPs, including but not limited to:
- Registering of self-employed status
- Income Tax
- Non-trading income
- Partners personal expenses
- Interest relief
- National Insurance Contributions (NIC)
- Capital Gains Tax
- Salaried Members
- Mixed member partnerships
With so many implications, why not contact our expert Tax Team to help guide you through the taxation of your Limited Liability Partnership? We will provide you with detailed guidance, so that your business can avoid any tax charges and meet your financial obligations.