Hi all,
We would love some advice. We are trying to register as an LLP, primarily as many business bank accounts will not let us bank as a general partnership. I am really struggling to make head or tail of some of it, so I was helping some people on here may be willing to advise. I have managed to register to file with Companies House, so do have a presenter ID and Code.
1. I can't seem how to register myself online, rather than through a third party service. Is there a way?
2. I have found CompanyRegistration.direct which seems to be quite reasonable as a third party register. Has anyone else used them?
3. I have found a cost of £50+VAT to register and the £34/year to file, is this right or are there other hidden costs that I may not have considered?
4. Maybe a silly question but I can't even work out what category photographers fall into. Anyone know?!
5. If you have any other information that I may not have thought of, please let me know.
Thanks so much everyone and if you need a photographer, please look our way!
Best,
Lucy
Hi Lucy,
It sounds like you’ve made good progress so far by setting up a software filing account and getting familiar with Companies House. Let me break down some of the specifics you’re dealing with to make things a bit clearer and give you a solid plan to move forward.
Registering an LLP
First off, Companies House doesn’t currently allow LLPs to be registered directly through their online portal, which is why you’ll need to go through a formation agent or use paper forms. If you decide to proceed with the agent you mentioned, CompanyRegistration.direct, they seem to have a reasonable reputation. However, do double-check their terms and conditions, especially for any ongoing costs they might include.
To save time, many agents handle both the registration and the first Confirmation Statement (a Companies House requirement to confirm your LLP’s details annually). That said, you should always confirm exactly what’s included in their services – some offer ‘add-ons’ that could drive up costs later.
Costs
The costs you’ve listed – £50+VAT to register and £34/year for filing – are accurate for most agents, but there are a few other potential costs to consider:
- Partnership agreement: Although not mandatory, drafting a bespoke agreement with a solicitor can cost anywhere from £300 to £1,000, depending on complexity. Without this, you’ll rely on the default statutory agreement, which is very basic and doesn’t provide much protection if disputes arise.
- Accountancy fees: LLP accounts can be complex due to their dual nature – taxed like a partnership but legally structured like a company. If you don’t already have an accountant, budgeting for one is essential, as they’ll handle both your LLP’s statutory accounts and its tax return. Costs typically range from £500 to £1,500 annually for small LLPs, depending on the level of service you need.
SIC codes
You mentioned struggling to figure out which category photographers fall into. For your LLP registration, you’ll need to select a Standard Industrial Classification (SIC) code. Based on what you’ve described, the relevant options are:
- 74201 (Portrait Photographic Activities): If your business focuses on portrait photography, such as weddings or individual sessions.
- 74202 (Other Photographic Activities): If you provide broader services, such as commercial photography or editorial work.
Filing obligations
- Annual accounts: These need to be filed with Companies House within 9 months of the LLP’s financial year-end. For example, if your first year-end is set to 31 March 2025, your accounts would need to be filed by 31 December 2025.
- Partnership tax return: The LLP must file a tax return with HMRC annually, detailing the profits and how they’ve been allocated to members. The deadline for this is 31 January following the end of the tax year (e.g., 31 January 2026 for the 2024/25 tax year).
- Confirmation Statement: This is an annual Companies House filing that confirms your LLP’s basic details, such as members and registered address. The cost is £34 if you file it yourself online (£64 by post), or more if your agent handles it.
It’s worth noting that while the LLP itself files accounts and a tax return, you and any other members will also need to file Self Assessment tax returns to report your share of the LLP’s profits.
Partnership agreement
I cannot stress enough how important it is to have a tailored partnership agreement. Without one, you’ll be stuck with the default terms under the Limited Liability Partnerships Act, which are often unsuitable for real-world business needs. For example, the statutory default doesn’t address what happens if a member wants to leave or if disputes arise.
A well-drafted agreement will cover areas like:
- Profit-sharing arrangements.
- Decision-making processes.
- What happens if one member wants to sell their share or if the LLP is dissolved.
Even if you’re setting up the LLP with close partners or friends, having this document in place can save significant headaches later on.
Tax timing and considerations
Lastly, you mentioned filing accounts with Companies House at the same time as with HMRC. These are separate processes:
- Companies House accounts: These reflect the LLP as a legal entity and must be filed annually, regardless of whether the LLP is trading or dormant.
- HMRC filing: Tax returns must align with the tax year (ending 5 April). Your LLP’s accounts may span a different period (e.g., a year-end of 31 March), but your accountant will ensure the two are reconciled correctly.
If your existing partnership is still operating, remember that it’s a separate entity from the LLP. The moment you start trading as the LLP, the partnership effectively ceases, and any profits from that date onwards should be attributed to the LLP.
Next steps
Based on your situation, here’s what I’d recommend:
- Confirm your LLP’s SIC code and register with your chosen agent.
- Arrange a consultation with an accountant who has experience with LLPs. They can guide you through the tax implications, filing deadlines, and other nuances.
- Engage a solicitor to draft a partnership agreement tailored to your business.
- Open a dedicated business bank account for the LLP to separate its finances.
If you’d like tailored advice or support with setting up your LLP, I specialise in helping start-ups navigate these kinds of challenges through my firm ABPraxis. We offer guidance on everything from partnership agreements to compliance and operational setup. Feel free to reach out if you need any assistance!
Wishing you the best of luck with your LLP – and your photography business!
Best regards,
Aaran
