TC09548 - [2025] UKFTT 00700 (TC)

Finance Act 2014 introduced new provisions relating to salaried members of limited liability partnerships (“LLPs”) known as the Salaried Member Rules (“SMR”). They are set out as ss 863A-863G of the Income Tax (Trading and Other Income) Act 2005 (“ITTOIA”). Their purpose is to tax as employees, those members of LLPs who are providing services on terms essentially similar to employees.

Within those provisions, ITTOIA s 863A(1)-(2) provides that a member is to be treated as employed by the LLP where each of Conditions A-C are met in respect of that member, so if one of the Conditions is failed, the SMR do not apply. ITTOIA s 836G is a targeted anti-avoidance provision, which provides that no regard is to be had to any arrangements, the main purpose, or one of the main purposes of which is to secure that the SMR does not apply to one or more of the members.