LLP registration

 

Limited Liability Partnerships (LLP)

 

1. What is a Limited Liability  Partnership (LLP)?

 

An LLP is a partnership which is in itself a legal entity, and whose partners enjoy limited liability. The partnership has existed as a corporate form in UK corporate legislation for more than a  century, but a new limited liability act, which was passed in 2000, has totally modernised the partnership, making its operation much more simple and convenient.

 

 

2. Source of corporate legislation:

 

Limited Liability Partnership Act 2000, Limited Liability Partnership Regulations 2001. A special form is signed by the partners and registered with Companies House. A Certificate of Registration is issued by Companies House following registration.

 

3. Time required for registration: 2 -3 weeks

 

4. Possible suffixes to the company name:  LLP or Limited Liability Partnership

 

5. Restrictions on company name:

 

The name of an LLP should not be the same as or similar to a name already registered. The name must not include the following names or their derivatives: British, English, European, Great Britain, United Kingdom, International, National, Institute, Authority, Board, Council, Chamber, Charter, Chemistry, Holding, Registered, Sheffield, Trade Union, Foundation, Trust, Stock Exchange, University, Credit
Union, Bank, Insurance and some others. Registration of names, including those containing the words mentioned above is possible only if approved by the relevant authorities.

 

6. Capitalisation: No minimum requirement.

 

7. Types of shares: No shares are issued

 

8. LLP Structure:

 

An LLP is formed by partners (at least two) for the purpose of carrying on a lawful business with a view to profit. The liability of the partners is limited to the assets of the LLP. The LLP does not have directors as it is usually managed by the partners, although it is also possible to appoint a manager.

 

9.  Number of directors: LLPs have no directors.

 

10. Number of partners:

 

A minimum of 2 partners are required to form an LLP. The minimum number of designated partners (see below) is 2. If the company has only two partners, both will be designated partners.

 

11. Who can be a partner in an LLP?

 

Any person or legal entity can be a partner in an LLP. There are no restrictions on the nationality or residency of the partners, i.e. partners may be either residents or non-residents of the UK.

 

12. What is the difference between a Limited Liability Partnership and a limited company?

 

The structure of an LLP is different from that of an Ltd. In addition, there are significant differences from the point of view of taxation. Limited companies are taxed as corporations, while LLPs are taxed as
partnerships (see the detailed information below).

 

13. Registered office address:

 

Each LLP must have a registered office, which must be a physical location, not just a post office box. The registered address can be anywhere in England and Wales. All official documents, letters and reminders of Companies House, as well as notices and court papers have to be sent to the registered office address. If an LLP changes its registered office address after incorporation, then Companies House must be notified of the new address within 14 days of  the change. All company documents (or copies of them) must be kept at the registered office address.

 

14. What is an annual return and when should it be submitted?

 

An annual return is a snapshot of the information on the LLP which must contain the following information:

 

·The name of the LLP,

 

·Its registered number,

 

·Its registered office address,

 

·The address where certain LLP registers are kept if not at the registered office,

 

·The name and address of each member,

 

·If not all the members are designated members, then details of which of them are
designated members.

 

The annual report is separate from the LLP's annual accounts. Every LLP must deliver an annual return to Companies House at least once every 12 months. The annual return should be delivered to Companies House within 28 days of the anniversary of incorporation of the LLP.

 

The designated members of an LLP are responsible for ensuring
that the annual return:

·Is delivered to Companies House in time, and

·Gives a true picture of the membership of the LLP at the time of delivery.

Designated members can be prosecuted if the LLP fails to deliver the annual return
in time.

 

15.    Annual accounts:

 

Every LLP must prepare annual accounts that report on the financial performance and position of the LLP during the year. The period reported on in the accounts is called the financial year, or the accounting reference period. This starts on the day after the previous financial year ended or, in the case of a new LLP, on the day of
incorporation. For all new LLPs, the first accounting reference period is automatically set as the first anniversary of the last day in the month in which the LLP was incorporated. For example, if the LLP Was incorporated on 10 June 2001 its accounting reference date would be set at 30 June. The next accounting reference period will start on July 1, 2002 and will end on 30 June 2003. The accounts must normally be delivered to Companies House within 10 months of the accounting reference date.

 

16.    What does a set of accounts include?

 

Generally, the accounts must include:

·A profit and loss account,

·A balance sheet signed by a designated member,

·An auditor's report signed by the auditor,

·Notes to the accounts, and

·Group accounts (if appropriate).

The accounts must be approved by the LLP's members and signed before they are sent to Companies House.

 

17.    Penalties for late filing of the accounts:

 

There is an automatic civil penalty for late filing. The amount of the penalty depends
on how late the accounts are filed. The fixed penalties are as follows:

Length of delay                                                                                          Amount of penalty

3 months or less                                                                                                      GBP 100

3 months one day to 6 months                                                                                  GBP 250

6 months one day to 12 months                                                                                GBP 500

More than 12 months                                                                                               GBP 1000

 

18.    Taxation of LLPs:

 

Failure to deliver accounts on time is also a criminal offence for which designated
members may be prosecuted.

LLPs are taxed as partnerships. This means that the company is not taxed at the
corporate level, as in the case of limited companies. The profit of an LLP is
divided between the partners in the proportion of their participation in the LLP, and
the partners must pay taxes in the place in which they are resident for tax purposes.
The income received from the LLP must be added to the income received from other
sources and tax should be calculated according to the total income.

19.    Double tax treaties:

 

If the partners of an LLP are non-residents of the UK, the LLP has conducted no
activities on the territory of the UK and received no income from UK sources,
then the partners will not become subject to taxation in the UK.

 

UNITED KINGDOM – LIMITED LIABILITY PARTNERSHIP

 

COMPULSORY COSTS:

 

FORMATION FEES:

 

Registration fees                            GBP200*

International apostilling                   GBP95

Courier fees   (depending on location)

 

* Registration fee includes: formation of the company, duties payable to the local authorities for the registration of the company, provision of the registered office for 1 year, Certificate of Incorporation, Partnership Agreement.

The price contains no hidden costs!

 

 

ANNUAL FEES:

 

Registered office address GBP55

 

OPTIONAL FEES:

 

LLP company accounts                             GBP650

Power of Attorney with Apostile                GBP120

Certificate of Good Standing                     GBP45

Mail forwarding services                           GBP20 (monthly fee)   

 

If you wish to set up your LLP with us please email us to enquiry@nvkgroup.co.uk with your request.