PartnershipsTraditionally, a partnership was not a separate legal person. It consisted of a group of persons (the partners) who were associated for the purposes of a business, with each partner being personally responsible for the partnership's obligations. The partnership profit is shared between the parties in an agreed profit sharing ratio, and each partner is responsible for paying his own taxes on his own profit share. However, in certain jurisdictions, a partnership may have corporate attributes and resemble a company (or a company may resemble a partnership). Examples of such cases are the UK Limited Liability Partnerships (LLPs) and the USA Limited Liability Companies (LLCs). Whilst these companies have corporate characteristics and legal capacity in their own right, the trading income is taxed like a partnesrship. They are tax transparent and the tax is levied on the individual shareholders (partners) instead of the company itself. This enables interesting tax saving schemes for LLPs and LLCs which are owned by non UK or USA residents and operate outside these countries. If you wish to find out detailed information about formation of partnerships, please fill in the Enquiry Form. |
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