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How to register an LLP with only co members

How do I register an LLP to get the UTR where they only have ltdco members - HMRC don't seem to know

Didn't find your answer?

A client has asked me to register an LLP for them with two corporate members and no individuals.

Corporation tax helpline refer me to agent helpline. Agent helpline refers me to corporation tax.

Where should I be going to be able to get a UTR - its not at all clear

 

***UPDATE***

OK - for those who want to know the answer to how to register an LLP to get a UTR where there are only corporate member you need to do the following (I can confirm that this has worked):
- Get hold of form SA402 - Registering a Partner for self assessment who is not an individual and send it in
- Several weeks later, if it has not turned up, call the agent helpline and explain that this falls between the cracks in HMRC. Not really a self assessment for individuals issue but certainly not a corporation tax issue. Eventually they will send the call through to the tech team who will be able to, after much effort, find the said LLP, confirm (hopefully) that a UTR has been created, and get them to send the UTR to the registered address.

That was quite a lot of effort to actually achieve this but the key is form SA402

Replies (24)

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By Clinton Lee
03rd Oct 2019 09:48

LLPs, to the best of my knowledge, consist of members who are taxed via self asssessment as self-employed individuals. So I'm confused as to how you can even have a corporate partner in an LLP.

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Replying to Clinton:
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By WhichTyler
03rd Oct 2019 09:58

Unfortunately the best of your knowledge is inaccurate, maybe time for somne CPD

"You can set up (‘incorporate’) a limited liability partnership (LLP) to run a business with 2 or more members. A member can be a person or a company, known as a ‘corporate member’."

Source: https://www.gov.uk/guidance/set-up-and-run-a-limited-liability-partnersh...

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Replying to WhichTyler:
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By Justin Bryant
03rd Oct 2019 10:12

Actually you can do this with just one human member acting in two different capacities e.g. on behalf on themselves and as trustee on behalf of a trust (of which they can be a sole settlor/beneficiary).

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Replying to Justin Bryant:
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By Tax Dragon
03rd Oct 2019 10:32

Is that confirmed?

The counterargument is that a trust, not being a person, cannot be a member.

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Replying to Tax Dragon:
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By Justin Bryant
03rd Oct 2019 11:42

Sometimes TD you really do make yourself to be a total fool. (In PNL's absence it now seems to be my job to call out total idiocy on this forum.)

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Replying to Justin Bryant:
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By Tax Dragon
03rd Oct 2019 11:52

Feel free to call out my total idiocy.

You would improve the forum if you also explained your total wisdom.

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Replying to Tax Dragon:
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By Justin Bryant
03rd Oct 2019 12:02

I would hardly describe the bleedin' obvious as total wisdom, but here goes anyway just to indulge your curiosity. A trust is invariably represented by a trustee, that is invariably a legal person able to enter into contracts etc.

Furthermore it is trite law that a legal person can enter into a contract etc. in more than one capacity e.g. on behalf of a company and personally.

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Replying to Tax Dragon:
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By The Dullard
03rd Oct 2019 12:05

A trust isn't even an entity, let alone a legal person. It's a relationship between the legal owners of property (the trustees), the person who put them in the position of being the legal owners of the property (the settlor) and the people intended to benefit from the property (the beneficiaries). Any of those people might be members of an LLP, but the trustees might be members on their own account or in their capacity as trustee. They might be doing it in both capacities, but if there's only one of them, they're still only one member.

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Replying to The Dullard:
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By Justin Bryant
03rd Oct 2019 12:17

Obviously your last sentence is wrong as if it's the same human (only humans can physically do things in these situations you know) signing the LLP agreement (and registering the LLP at CH) but acting in 2 different legal capacities as I explained above then there are two members (the human and the trust/company etc.).

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Replying to Tax Dragon:
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By The Dullard
03rd Oct 2019 12:37

Exactly! A company is a legal person, albeit it needs a human to sign its bits of paper, but a trust is not a legal person. Only the trustee is a legal person, and one legal person as a member, even in different capacities, is one member. Any decent lawyer would know that!

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Replying to Tax Dragon:
Hallerud at Easter
By DJKL
03rd Oct 2019 19:35

We have two FURBS as partners in an LLP, FURBS being in effect trusts.

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Replying to DJKL:
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By Tax Dragon
04th Oct 2019 10:28

DJKL wrote:

We have two FURBS as partners in an LLP, FURBS being in effect trusts.

Do you mean that no individuals were named on the incorporation document?

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Replying to WhichTyler:
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By Clinton Lee
03rd Oct 2019 23:22

Many thanks!

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By whitevanman
03rd Oct 2019 20:45

Whilst all very interesting it seems to be a long way from the (answer to the) original question.
As far as I was aware, a LLP , once incorporated, had to be registered with Companies House.
Also, as far as I am aware, once registered, CH sends (amongst other things) notification to HMRC who then should set-up the LLP on their CT system. Somewhere in this process, the UTR is automatically generated. HMRC then send out forms for set-up purposes which would contain the UTR.
Logically it would be the CT section that should know the process, not (necessarily) the agent helpline.
I would say that you should first ensure the LLP has been registered and only then, if the UTR does not become known, should you chase HMRC.
One thing that could be useful. Have you a contact at HMRC for any of the corporate members (a CRM or an ongoing enquiry?). If so you could prevail on that person to pursue it?

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Replying to whitevanman:
Hallerud at Easter
By DJKL
03rd Oct 2019 21:57

Why on their CT system, it surely registers as a partnership for tax purposes?

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Replying to DJKL:
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By whitevanman
03rd Oct 2019 22:43

A LLP is actually a corporate entity with a legal personality separate from its members. It is just that, where the LLP carries on a trade or business with a view to the realisation of profit, is, for certain tax purposes, treated as a partnership.
So, as far as I am aware, the process is the same as that applying to companies (see my earlier post). Where appropriate, HMRC then creates partnership or individual records in SA but i suspect that is only when advised by the partnership that it is carrying on a trade etc. Where the members are all corporates, each is taxed on its share in its CT. Cannot remember whether HMRC insists on a partnership SA return in those circa (possibly). If the LLP does not fall to be treated as a partnership for tax purposes, a CT return could be required annually (subject to usual exceptions).

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Replying to whitevanman:
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By whitevanman
03rd Oct 2019 22:56

Sorry, I really should read my posts before sending!
It seems I have still not fully clarified.
It used to be that HMRC set up companies when they received notice of an incorporation from Companies House. That included giving a UTR. I think tge actual process changed some years ago and UTRs are generated either by actions taken by CH or HMRC. Whichever, the UTR is generated in response to the incorporation on the HMRC CT system.
Possibly as a result of the receipt of what I have referred to as "set-up" forms, HMRC would become aware the LLP was trading etc and would then be able to set up a partnership record on SA. Exactly what they would need or when, in order to do this, I cannot say.
The problem (as with so many other things) is that many people within HMRC probably don't know any of this!
The CT section should know. I would guess that the CT section of Large Business is the most likely to know. Now you just need to get hold of them!

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Replying to whitevanman:
Hallerud at Easter
By DJKL
04th Oct 2019 10:06

Thanks for that, interesting- the wonders of the inner mechanisms of HMRC and watching the cogs turn.

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Replying to whitevanman:
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By unearned luck
09th Oct 2019 23:27

The FTT agreed with Whitevanman's analysis in the recent case of INVERCLYDE PROPERTY RENOVATION LLP & Another. HMRC successfully argued that the LLPs were not carrying on a trade (thus denying the members loss relief) but this argument also shot HMRC in foot as they had opened and closed their enquiry under the IT provisions and not the CT ones and thus their closure notice was of no effect and there was no deemed enquiry into the members' TRs. An LLP is a company but is only treated as a partnership for only as long as it is carrying on a trade. Since to form an LLP you only need a 'business'. From incorporation until whenever the trade starts, it should be treated the same as a limited company. HMRC forgot that in Inverclyde.

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By nick farrow
10th Oct 2019 09:15

so can you register an LLP with no individuals as partners just limited companies?

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By Tax Dragon
10th Oct 2019 13:28

Why was Justin's comment at 12:17 on 3rd Oct 2019 merely edited (to remove the bit that - presumably - offended, leaving the bit that continued the discussion in situ), while my reply to that comment (which also continued the discussion and was in no way offensive, although I can see why the bit where I quoted Justin would need to be edited out) was removed in entirety, leaving The Dullard's response to me hanging?

Nick, I pointed you here because it answers your question.

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Replying to Tax Dragon:
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By nick farrow
10th Oct 2019 15:58

thanks TD I've reread all this and the HMRC link (and spoken to a lawyer) and I am now happy that an LLP can indeed have just 100% limited companies

btw even in this scenario I assume the LLP tax return will still be registered for SATRs in the normal P'ship way

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Replying to nick farrow:
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By Tax Dragon
10th Oct 2019 16:44

I thought this thread talked about that too (hands up, I've not read it all).

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By Kylo Ren
01st Nov 2019 10:34

OK - for those who want to know the answer to how to register an LLP to get a UTR where there are only corporate member you need to do the following (I can confirm that this has worked):
- Get hold of form SA402 - Registering a Partner for self assessment who is not an individual and send it in
- Several weeks later, if it has not turned up, call the agent helpline and explain that this falls between the cracks in HMRC. Not really a self assessment for individuals issue but certainly not a corporation tax issue. Eventually they will send the call through to the tech team who will be able to, after much effort, find the said LLP, confirm (hopefully) that a UTR has been created, and get them to send the UTR to the registered address.

That was quite a lot of effort to actually achieve this but the key is form SA402

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