UK Limited Liability Partnership (LLP)

  • Limited Liability Partnership is a form of business entity with limited liability for the members. LLP is a joint entity for two or more members (individuals or companies) for carrying on joint business.
    Limited Liability Partnership should be registered with Companies House in accordance with Limited Liability Partnership Act 2000,  Limited Liability Partnerships Regulations 2001, and some provisions of Companies Act 2006.
    LLP has organization flexibility and taxed as a partnership, namely: each member is taxed separately on profit received from LLP. This form of entity has become very popular recently, however, is specific and requires taking proper advice whether LLP is the best vehicle for your business.

  • Partnership Name

    • Can't be exactly the same as another registered company’s name;• Must end with LLP• Can’t contain “sensitive ” words unless you get permission. For example, «Holding», «Group», «International», «Trust», «Royal» and others.

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Partners of LLP (Members)

  • LLP should have at least two Designated Members
    An individual or a company can become a member of LLP. They sign a Partnership agreement, in which their shares in profit and loss of LLP, their obligations and powers will be determined.
    If there are more than two members in LLP, Partnership agreement also states who are Designated Members. 

  •   Designated members have additional obligations, namely:
      Submission of Confirmation Statements and accounts to Companies House and HMRC;
      Submission of all changes (address, members’ details, appointments) to Companies House;

  •  Signing accounts and bills on behalf of LLP
      Appointment of Auditors (if needed)
      Representing LLP in all disputes including liquidation procedures 

• Directors are not appointed in LLP. Designated Members perform all administrative and representative duties similar to what Directors do in ordinary companies.

• Not appointed.

Registered Office Address
• Every LLP must have a Registered Office address in the UK. It must be a physical location in the United Kingdom at which official documents can be served. 

Person with Significant Control
A person with significant control (PSC) is someone who owns or controls your LLP. They’re sometimes called ‘beneficial owners’. Details of PSC must be recorded and submitted to Companies House

Annual Requirements
LLP must prepare and submit on annual basis:
• Confirmation Statement. It is a snapshot of general information about registered office address, Designated and ordinary Members of LLP, PSC or RLE.
• Accounts. Financial report about LLP’s business activities for a financial year. Usually, financial year is a 12 month period. However, financial year can be shortened or extended under special terms. If LLP never traded during its financial year, it is considered to be dormant and should submit dormant accounts. There are late filling penalties if you submit LLP  accounts late. Penalties Explained. 
• Tax Return. Under certain circumstances and after proper notification to HMRC, LLP does not need to submit tax return to HMRC. Provided that:
• LLP is not working and/or controlled in the UK;
• LLP does not have any property in the UK;
• Members of LLP are non residents in the UK;
• LLP does not receive any profit from UK sources, etc.
• Relief from submission of tax returns should be properly confirmed by HMRC, thus we recommend you to take an advice from tax advisor or accountant.
• LLP that is not relieved from tax returns should submit their tax returns to HMRC on annual basis. Financial year for LLPs is the same as for individuals – from 06 April till 05 April of the next year. It causes certain inconveniences and inconsistences between Companies House and HMRC. For such LLPs we recommend to change accounting reference date so it matches with accounting reference date of HMRC;
• There are late filling penalties if you submit LLP tax return late. Penalties Explained. 


For financial years that begin on or after 1 January 2016 your company may qualify for audit exemption if it has at least 2 of the following:

  • Annual turnover must not be more than £10.2 million

  • Assets worth no more than £5.1 million

  • The average number of employees must not be more that 50

TaxationThe key advantage of LLP is that it is not taxed as a company and thus is not subject to UK Corporation tax. Each member of LLP is taxed separately on its income received from LLP in the country of its tax residence. Thereby if LLP is not controlled from the UK and does not receive any profit from the UK sources and its members are not residents in the UK, neither LLP nor its members are subject to UK taxation. If, however, LLP receives profit from the UK sources, its members (even not residents) must register with HMRC and declare income received from LLP, from UK sources and to pay taxes on such income.VAT. Standard VAT rate since 04th January 2011 – 20%.LLP must register for VAT with HM Revenue and Customs (HMRC) if  • Your business VAT taxable turnover is more than £85,000 (the “threshold”) in a 12 month period • You expect to over threshold in a single 30 day period • You receive goods in the UK from the EU worth more that £85,000. If LLP is VAT registered, it should submit VAT returns on a quarterly basis notwithstanding whether or not it made VAT taxable supplies.There is no threshold if neither Members nor your business is based in the UK. Such LLPs are not required to be VAT registered.  
Public Information
Information about LLPs is open for public in the UK. All accounts, Confirmation statements, former annual returns, names of Members (including resigned), Persons with Significant Control or Relevant Legal Entities are available for public.