B7.107 Limited liability partnerships
Limited liability partnerships (LLPs) are in law regarded as bodies corporate and are subject to aspects of company law1, but for tax purposes they are generally treated as partnerships2.
The LLP structure allows members to limit their liability while organising themselves internally as a partnership. This structure is inherently appealing to professional partnerships as it reduces the potential risk of substantial personal liability of the individual partners. However the LLP structure is available to a much wider group of persons and businesses.
The majority of law applicable to LLPs is actually modified company law rather than partnership law. LLPA 2000 expressly states that, except as otherwise provided in that Act or regulations made pursuant to it, the law relating to partnerships does not apply to an LLP3.
Due to the fact that an LLP is a company, it has a legal personality separate from its members. This means that, like a company, it is liable for its own debts, it will contract in its own name with third parties and it can sue and be sued in its own right4.
To 'incorporate' an LLP the incorporation document must be registered with the Registrar of Companies. The incorporation document must include the names of at least two members and contain particular details (name, address, statement of persons with significant control (PSC) etc5). The PSC register is intended to help increase transparency over who owns and controls UK companies, LLPs, unregistered companies and listed companies on UK secondary markets, and