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The UK LLP is governed by The Limited Liability Act 2000. Similar to how partnerships are treated in other countries, this Act provides for individual members to be subject to taxes and not the partnership. That’s because the LLP is not a company or a corporation or any other legal entity.
The UK LLP is a Limited Liability Partnership which is a combination of a typical partnership with a Limited Liability Company (LLC) usually created through a written LLP Agreement which specifies how it will be formed and operational.
UK stands for United Kingdom which is much more than England. The UK is commonly referred to as “British” and includes England, six counties of Ireland, Scotland, Wales, and Northern Ireland. Its government is known as the UK government or the British government which is led by its Prime Minister who appoints all other ministers. The Cabinet is the supreme decision making committee consisting of the Prime Minister and senior ministers.
The Parliament creates primary laws and pursuant to the Fixed-terms Parliaments Act of 2011, its members are elected every five years for its House of Commons unless a vote of no confidence occurs causing an earlier election. After each election, the monarch (current is Queen Elizabeth II) selects the Prime Minister who is the leader of the political party most likely to command a majority of ministers in the House of Commons.
The English Constitution allows authority with the monarch. However, such authority is rarely exercised by the monarch who relies on the Prime Minister and the Cabinet to rule the United Kingdom and its governmental departments.
A UK LLP receives many benefits including:
A LLP in the UK must pick a unique name that is not similar to already existing LLP’s, companies, or corporation names.
A LLP in the UK must have an office address. This address will be used for process service requests and official notices.
A LLP in the UK must have at least two members. The UK allows both private persons and corporate entities to be members.
Directors and Officers
A LLP in the UK is not required to have directors as the members act as directors. No officers are required.
The minimum authorized capital for LLPs in the UK is GBP 0.
A LLP in the UK is exempt from corporate taxation. The partnership members can remain exempt from income taxes provided that no business or trade is carried out with or within the United Kingdom. However, U.S. citizens and those residing in countries who tax worldwide income are required to declare all income to that tax authority.
UK LLP’s pay GBP 32 as their initial registration fee plus formation and registered agent fees. LLP’s are required to file annual tax returns whose filing fee is GBP 30 (if manually done) or GBP 15 (if filed electronically) plus registered agent and service fees.
UK LLP government registration information is made available to the public. Accounts which are filed with the government can also be accessed by the public.
Accounting and Audit Requirements
UK LLP’s are required to prepare account records. Audits normally can occur with large LLP’s, but not small ones.
Annual General Meeting
An annual general meeting is not required of UK LLP’s.
Time Required for Incorporation
A UK LLP can expect the time to register will be within 24 hours if registered electronically.
A LLP in the UK can purchase a shelf LLP for faster registration.
Form a UK LLP Conclusion
A UK LLP receives many benefits including: no corporate tax, no income tax as long as income is not earned in the UK, only two members to form a LLP, low registration fee, fast registration within 24 hours, and no minimum authorized capital.