Timeline and RACI matrix for setting up an LLP Company
A Limited Liability Partnership (LLP) is a business structure that combines the flexibility of a partnership with the liability protection of a corporation. LLPs are particularly popular among professional services like law firms, accounting practices, and consulting firms due to their flexibility and liability protection.
How an LLP Works
Structure: An LLP is a separate legal entity from its partners, meaning it can own property, incur debts, and be sued in its own name. Each partner's liability is limited to their investment in the LLP, protecting personal assets from business debts
Management: Partners in an LLP typically share management responsibilities, and the specifics are outlined in an LLP agreement. This agreement details roles, responsibilities, profit-sharing ratios, and procedures for adding or removing partners
Taxation: LLPs often benefit from pass-through taxation, where profits are taxed at the individual partners' level, avoiding double taxation that corporations face.
Setting Up an LLP - A timeline
Setting Up an LLP - Deliverables & Tasks
DELIVERABLE
Agree LLP name
TASKS
Brainstorm potential names; create a shortlist
Check shortlist name availability on Companies House
Ensure name complies with naming rules (e.g., not offensive, not too similar to existing names)
Agree final name choice
Reserve domain name and social media handles (optional)
Quality Notes
Must end in “LLP” or “Limited Liability Partnership”
Must be unique
Decide on members & roles
Identify at least two designated members
Collect personal details (name, address, DOB, nationality)
Agree on roles and responsibilities
Confirm consent to act as members
Quality Notes
Minimum of 2 designated members required
Decide on registered office address
Choose a UK-based address
Ensure it meets legal requirements (e.g., accessible for official correspondence)
Obtain consent if using a third-party address (e.g., accountant or virtual office)
Set up mail forwarding if necessary (optional)
Quality Notes
Must be a physical address in the UK (for instance, cannot be a PO box)
Create LLP agreement
Appoint legal advisor; schedule review sessions
Define profit-sharing ratios
Outline decision-making processes
Set rules for adding/removing members
Set dispute resolution mechanisms
Create Draft 1 (physical document)
Circulate for review; collate suggestions
Create Draft 2 (physical document)
Circulate for review; collate suggestions
Review with legal advisor
Meeting with all members for final walkthrough
All members sign
Register with Companies House
Complete the LL IN01 form (online or paper)
Provide details of members and registered address
Submit LLP agreement (optional but recommended)
Pay registration fee (£10 online, £40 by post)
Receive Certificate of Incorporation
Monitor Companies House for confirmation
Download and store certificate securely
Notify all members
Notes on lag
Online application is typically processed within 24 hours (1 business day)
Postal application can take 8 to 10 working days
Register for HMRC services
Register the LLP for Self Assessment
Register each member for Self Assessment
Register for VAT (mandatory if turnover exceeds threshold; optional beneath this)
Register for PAYE if hiring employees
Open business bank account
Compare business banking options select provider
Prepare and provide required documents (member IDs, proof of address, incorporation certificate)
Submit application for new account
Set up online banking
Quality Notes
Documents required for banking KYC:
Certificate of Incorporation
LLP Agreement
Proof of registered office address
ID and proof of address for all designated members
Details of business activities and expected turnover
Email addresses for members will be needed to setup online banking
RACI Matrix
R = Responsible, A = Accountable, C = Consulted, I = Informed