On 21 February HMRC published updated guidance on the new ‘salaried member’ rules which from 6 April will treat members of UK limited liability partnerships (LLPs) as employees for tax and National Insurance if they meet three conditions. These will be tested for the first time on that date leaving LLPs little time to adjust their arrangements.
The initial draft legislation and guidance met with a storm of protest because the new regime bore little resemblance to the original consultation and significantly tightened the rules for professional firms. The new guidance is an improvement but is still far from perfect.
How can I tell if my remuneration is ‘disguised salary’ (condition A)?
The essential feature of disguised salary is that the individual’s remuneration is not affected by the profitability of...
