Richard Curtis looks at a recent Upper Tribunal decision concerning the salaried partners tax legislation.
The introduction of the limited liability partnership (LLP) in 2000 mitigated the potential problems with general partnerships, particularly a partner's unlimited liability. There are administrative obligations, but as with ordinary partnerships, the member partners were generally treated as self-employed (under ITTOIA 2005, s 863 and SSCBA 1992, s 15(3A).
However, to combat perceived disguised employment, from April 2014 new sections were inserted into ITTOIA 2005. Section 863A (‘Limited liability partnerships: salaried members’) states that if all of conditions A to C in ss 863B to s 863D are met, a member of a limited liability partnership is treated as being employed by the limited liability partnership under a contract of service instead of being a member of the partnership.
The three
