Are you planning to start a business in the U.K. but are scared about the legal requirements needed to register? It should be easy to know what to look for and which steps to follow if you are open to researching. This article explains some of the five things you should know when registering your LLP.
Important Details to Note when Forming an LLP.
A few general steps apply when you are interested in forming an LLP and registering it. However, the specifics may vary from one region to another. Even so, it helps you to understand some of the basics that will guide your registration process. Keep reading.
You Must Be Eligible
Did you know that not everyone is eligible to register LLP online UK? Unknown to many, there is a specific regulation that stipulates eligibility. Find out what the law in your area says about your eligibility before rushing to register. The U.K. government may have particular stipulations on registering for LLP.
You want to know the specific requirements for successful registration. Check out what the U.K. government has to say about LLP registrations. Once you fit the profile, you can proceed to register. It’s only wise to find out if you are indeed eligible. After all, this process takes time, and you would hate finding out that it was all a waste of time.
Choose a Name for the LLP
Once you are clear and are sure that you qualify for LLP registration, proceed to find an appropriate name. This is another process you ought to pay attention to. Note that the registration is not complete without a company name. You may have to conduct specific name searches to ensure no duplicates.
Besides finding a name that stands out and is different from any other, you should find one that resonates with your business. Make sure your potential clients will not struggle to identify with the business because the name does not resonate with it. Note that whatever name you choose, you will have to add LLP at the end, so choose wisely.
Have a Registered Address
An official address is mandatory when registering an LLP in the U.K. It serves as the place where all official communication goes. Some people choose third-party agents as their official address, which is not an issue. Just make sure that part of their services involves forwarding all the mail to their address. The registered address should have the following:
- A physical address
- Country where the LLP is registered. While the P.O. Box is accepted, you must include the physical address after. You also need to add the postal code. Alternatively, use your home address as this will be publicly available.
Register and apply for Relevant Certification
There are several ways to apply for your LLP registration. Two ways apply, the first being registering yourself through an approved software. Alternatively, you can use an agent and register via post. You will receive a certificate of incorporation once the LLP has been successfully registered.
This is the option where one registers via approved software. Third-party software can be used to register the LLP, and the pay will depend on the software in use. In most cases, registering through third-party software takes 24 hours, but you can get it registered the same day if you apply before 3 pm and are willing to pay extra for this. Find the recommended third-party software, download it and apply.
Registering via Post through an Agent
Formation agents can help you register your LLP as they do it for you at a fee. The amount required varies and is dependent on the agent in question.
You Need to Define Members Responsibilities
An LLP is a business arrangement that involves more than one person. While the number of ordinary members is not defined, you must have two designated members. These will have more roles to play as they will be responsible for all the company account keeping and other sensitive duties or roles. Part of defining member roles should be defined in different categories. It is essential to have an LLP agreement that stipulates how it will be run. It includes specific details on:
- Profit-sharing among members
- Decision agreement procedures
- Member’s responsibilities
- The process of how members join and leave the LLP
You can involve a solicitor to make the definitions and agreement legally binding. Members should carry out all their legal obligations as stipulated in the agreement. Each member must register for the self-assessment with H.M. Revenue and Customs (HMRC). As mentioned earlier, the designated members have more roles. They have to:
- Register the business for Self Assessment with HMRC. Besides this, they also need to register separately as an individual.
- Register the partnership for VAT if the projected business’s sales are likely to be more than £85,000 a year
- Take care of appointing an auditor when needed.
- Focus on keeping the business’s accounting records
- Sign and send yearly accounts after preparing them. These should be sent to Companies House.
- They also need to send a confirmation statement (Previously annual return) to Companies House.
You could consider more when registering your LLP in the U.K., but the above is probably the most basic requirement. It helps to stick to the government regulations. After all, no one wants to be on the wrong side of the law. Why would one choose to register an LLP instead of other business formats? Several advantages come with this. Here are a few you may want to note.
- It offers a bit of flexibility, especially financially, since it is easy to restructure if needed
- It comes with tax breaks.
- One is assured of personal liability protection. Each partner is protected from the potential mistakes of the other.
If you intend to have an LLP in the U.K., register correctly. Understand the most critical details that this type of business requires. With the suggested tips and expectations above, you have a rough idea of proceeding. Once you decide that an LLP is more suited for your business, ensure you are on the right page with the government.