I am seeing a client who has forwarded me the 31 March 2017 LLP accounts. There are 4 members and there is an amount of £500k as members remuneration treated as an expense. This leaves £12k profit which the client is saying is the profit shown on the LLP tax return. The £125k for my client is then reported as income on a second partnership tax return for him and his wife. Personal expenses (assumed business but not paid by LLP) are deducted and the profits are shared 60:40 between them.
I can't see that the treatment of the members remuneration is correct but cannot find anything in the legislation to support my arguement.
I don't deal with many LLP's and so readers thoughts are greatly appreciated.