Limited liability partnerships (“LLPs”) is another form of UK business entity. They enjoy the commercial benefits that come from being a body corporate and their members benefit from the protection of limited liability. LLPs can be attractive vehicles for professional firms and other businesses, including start-ups and joint ventures.
LLPs were introduced in April 2001 following the Limited Liability Partnerships Act 2000.
Characteristics of an LLP
LLPs must file an annual return and annual statutory accounts similar to those filed by limited companies. Small company exemptions apply, including audit exemptions rules. Generally, though, Companies House compliance requirements are minimal.
There are no directors. However, “designated” members have particular responsibility for certain statutory requirements. There must be at least two designated members who have the same rights and duties towards the LLP as any other member. The law also places extra responsibilities on designated members.
In particular they are responsible for:
- Appointing an auditor (if one is needed)
- Signing the accounts on behalf of the members
- Delivering the accounts to the Registrar
- Notifying the Registrar of any membership changes or change of registered office
- Preparing and signing the Annual Return
- Acting on behalf of the LLP if it is wound up or dissolved.
Members do not have to contribute a minimum amount of capital, even in the event of a winding up.
The statutory package for a LLP includes:
- Registration of LLP within 24 hours
- Providing a template of a partnership agreement
- Original Certificate of Incorporation
- Designated members first minutes
- Check the availability of your proposed name using our free Company Name Check
