I would be very greatful for some advice on the following.
My newly formed LLP is about to start the construction and operation of a small renewable energy generating turbine. We have 4 members (two corprate and two individuals already self-employed in the renewable sector) and together we provide all the services and equipment required to construct and operate the type of renewable generator in question.
"Properties" used solely for renewable generation are exempt from business rates if more than 15% of profits are donated to charity. As we must give 5% of gross revenue to charity (a lease requirement), we would like to keep our profits low and gain exemption for a few years.
To fund the project we intend to each loan the LLP a certain amount of capital (the LLP has no member capital) which will be paid back in fixed installments over x number of years.
We will also be carrying out all the construction, consultancy and manufacturing of the projects ourselves and would like to invoice the LLP for this work at market rates. The idea being that the LLP will not have the capital reserves to pay these invoices and will have to pay them off over a period of years, thus keeping profits down. My question is, is there anything wrong with this invoicing? The invoices would of course be reasonable and fair amounts with no interest charged.
The LLP will receive all the revenue generated through the project from electricity sales.
Any advice would be greatly appreciated and if you would like anything clarifying please let me know. I will be discussing the final arrangements with an accountant, however would like to go into the meeting with as much information as possible.