The salaried members rules were introduced in 2014 to deal with ‘disguised employment’ of members of limited liability partnerships (LLPs). LLP members are normally treated in the same way for tax purposes as partners in a traditional partnership but, under the salaried members rules, they can be treated as employees if certain conditions are met. The conditions relate to ‘disguised salary’, significant influence and capital contributions. If all three conditions are met, the individual will be treated as an employee. Care is required to ensure that the rules are applied correctly, and evidence of how member remuneration is determined and key business decisions are made should be maintained.
If you are not a subscriber, subscribe now to read this content.
The salaried members rules were introduced in 2014 to deal with ‘disguised employment’ of members of limited liability partnerships (LLPs). LLP members are normally treated in the same way for tax purposes as partners in a traditional partnership but, under the salaried members rules, they can be treated as employees if certain conditions are met. The conditions relate to ‘disguised salary’, significant influence and capital contributions. If all three conditions are met, the individual will be treated as an employee. Care is required to ensure that the rules are applied correctly, and evidence of how member remuneration is determined and key business decisions are made should be maintained.
If you are not a subscriber, subscribe now to read this content.
.tmb-editorspic.jpg?sfvrsn=df04ab27_1)
