With effect from the 6th April 2001, a completely new form of legal entity known as the limited liability partnership (LLP) was made available for registration.
The essential feature of an LLP is that it combines the organisational flexibility and tax status of a partnership with limited liability for its members. The limited liability partnership is a separate legal entity with unlimited capacity. In the main, any third party would usually contract with the LLP rather than the members themselves.
The LLP’s structure and existence as a separate legal entity makes it closely akin to an ordinary private limited company than to a partnership except insofar as the internal regulations are governed by agreement between the members. The term “members” (usually associated with a company limited by guarantee) is used in this context to differentiate them from unincorporated partners.
First Corporate can now form an LLP company electronically similar to forming a private company online – simply choose the LLP feature on our ‘Form a Company’ section. To form a LLP manually, the proposed members would subscribe their names to a form LLP2 (with relevant continuation form if required) and file it with the Registrar of Companies, together with the respective registration duty. The Act does not require an agreement to be entered into between the members and there is no requirement to publish it.
The minimum number of persons wishing to incorporate as an LLP is two. At least two of the members are required to act as “designated members” responsible for performing the administrative and filing duties of the LLP similar to those usually associated with a company secretary. Unless there are at least two designated members, all members are designated members. Name checking procedures for incorporation is subject to the same guidelines as that of a private limited company. It is not possible to register a LLP in the name of an existing private or public limited company nor will it be possible to incorporate a LLP as a Charity or to re-register a private company as a LLP or to convert either way. LLP’s may be incorporated in England & Wales and Scotland.
LLP’s are obliged to file annual accounts and an annual return with Companies House as well as notification of any changes that take place within the partnership E.g. appointments/ resignations/ changes in particulars of members (form LLP 288a/b/ c) etc and any change of registered office address (form LLP287).
A LLP is taxed as a partnership. The internal structure is much the same as a partnership with the members providing the working capital and sharing any profits. Income derived by the members from the LLP is closer to that of a partnership than to dividends paid by companies. Members are liable to pay Class 2 and Class 4 National Insurance contributions.
Our fee for incorporating an LLP is £115.00 with an additional £32.00 for a loose-leaf register if required, should you require a guaranteed same day service the fee on a ‘same day’ basis is £164.00 inclusive. We can also provide a draft partnership agreement on application for an additional £120.00 plus vat.