Running a partnership

Every partner has the right to take part in the management of the partnership business - subject to any conditions in the partnership agreement.

Each partner must complete individual self-assessment tax returns on their share of profits and submit these annually to HMRC. They must also pay National Insurance Contributions (NICs).

The nominated partner must complete a Partnership Tax Return, showing each partner's share of the profits or losses.

Unless a partnership agreement states otherwise, most decisions can be taken by a majority of partners - however unanimity is required for any fundamental changes such as the admittance of a new partner.

In the absence of a partnership agreement, all partners have an equal role in decision-making and are entitled to an equal share of profits.

LLPs are required to provide financial information equivalent to that of limited companies, including the filing of annual accounts. From 6 April 2016, LLPs must start keeping a register of people with significant control ('PSC'). For more information, read the general guidance on the PSC regime.

As with ordinary partnerships, an LLP must submit a Partnership Tax Return, in addition to the responsibility for each partner to submit individual self-assessment tax returns on their share of profits along with making required NIC payments.

Designated members must sign annual accounts and file these, together with annual returns, at Companies House. From June 2016, the new confirmation statement is due to replace the annual return. The purpose of the confirmation statement is exactly the same as the annual return and it must be filed at least once every 12 months.

Designated members must notify Companies House of any changes to the LLP's membership, members names and residential addresses or the registered office address.

The general partners must notify the Registrar of any changes to details concerning the limited partnership within seven days.

Where a general partner becomes a limited partner or a limited partner’s share is to be assigned to another party, notification must be made to the London, Edinburgh or Belfast Gazette as appropriate.

Generally, limited partnerships do not have any ongoing annual disclosure requirements.

However, if all the partnership’s general partners are limited companies, the limited partnership will become a Qualifying Partnership for purposes of accounting disclosure rules. Any Qualifying Partnership must draw up and file accounts as if it was a limited company.

At any time after registration, a general partner can apply to the Financial Conduct Authority for authorisation to act as an Authorised Contractual Scheme. Any authorisation or revocation of such authorisation must be notified to Companies House.