Unincorporated body as LLP member

Unincorporated body as LLP member

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Hi,

I mean for unincorporated body a simple "association" between two or more persons with a written agreement. Like a club or charitable association so to speak.

I would like to know if in your opinion can it be possibile to use as LLP members two unincorporated body or a corporate body and a unincorporated body. In my specific case all members will be non resident in UK.

Thank you in advance for your opinion.

 

Replies (3)

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By naomi2000
25th Oct 2016 21:54

I don't think that your unincorporated body is a legal person (at least in England and Wales) . If you tried to do this , I think that you run the risk of making the unicorporated body a partnership and having its members taxed on the income from the LLP.

It looks to me as if you may be trying to translate a familiar structure from your client's home country into a UK environment . This never works because the rules won't be the same.

You need to get your client to take a step back, write down on one side of paper what they want to do and then you can recommend a UK structure for the venture.

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By marc_london
25th Oct 2016 22:42

Yes, I confirm you the unincorporated body is not a legal person but, I forgot to tell you that the unincorporated body is created and notarized outside the UK (in the Isle of Man). In my opinion HMRC, due the member is not UK resident, shouldn't look through to the persons inside the unincorporated body but it should attribute a single UTR treating it as opaque, like a corporate to be clear. This way the unincorporated body should directly pay income tax to HMRC and the person inside the unincorporated body can share the net profits based on their internal agreement.

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By Tim Vane
26th Oct 2016 05:23

The legislation in LLPA 2000 implies that only an individual, a corporation or a scottish firm can be a member of an LLP. I don't see how an unincorporated body setup in the IOM can be any of those things, so it can't be a member.

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