Salaried Members: Global Structures: Working for the UK LLP
To be a Salaried Member, the individual has to be working for the UK LLP, see ESM60020.
This example illustrates a profit share paid to a UK partner by an overseas firm.
ABC LLP is associated with a US partnership ABCUS LLP (formed under the law of Delaware). A B and C are members of ABC LLP and so is ABC US LLP.
A B and C are members of ABC US LLP which also has a further 10 members.
All profits of ABC LLP are paid to ABC US LLP and shared by its members along with the other profits of the firm. A B and C receive a share of the global profits.
A B and C are not Salaried Members as they do not have any income in their capacity of members of ABC LLP. However, ABC LLP is a mixed membership partnership and the mixed membership partnership rules (new sections 850C to 850E) need to be considered.
The AA LLP in the UK is linked to AA GP in Australia. A number of people, including C, are members of both firms.
C **is based in Australia. C works full time as a member of AA GP, she does not do any work directly for AA LLP as a member of AA LLP.
*Normally C receives all her reward from AA GP but under the arrangements between the parties she will receives a profit share from AA LLP where AA GP makes insufficient profits. *
In this case, C does not receive her profit share for working for AA LLP; hence she is not a Salaried Member as she does not receive a sum for working for the UK LLP.