- Original Poster
- #1
Hello,
Looking for some clarification around company structure.
The proposed structure is as follows:
LTD company (master franchisor)
LLP x (infinite) with franchisee as partner but also LTD franchisor as corporate partner.
Out of the LLP, the franchisee would pay all running costs etc, the profits would then be split as per the agreement. This would see the master franchisor take drawings from multiple LLPs (franchises).
A few questions this raises:
1) the LTD franchisor would be corporate partner in potentially hundreds of LLPs, would HRMC frown upon this?
2) From a tax point of view, would the drawings of profits be classed as other operational income to the LTD and would be subject to standard corporation tax?
3) Is the LLP percentage owned an issue? For example if the LTD had a majority stake i.e > 75%
4) If the franchisor LTD company wanted to do promotions (which could include giveaways) to the customers of the LLPs, would this be an issue?
Thanks in advance!
Jack
Looking for some clarification around company structure.
The proposed structure is as follows:
LTD company (master franchisor)
LLP x (infinite) with franchisee as partner but also LTD franchisor as corporate partner.
Out of the LLP, the franchisee would pay all running costs etc, the profits would then be split as per the agreement. This would see the master franchisor take drawings from multiple LLPs (franchises).
A few questions this raises:
1) the LTD franchisor would be corporate partner in potentially hundreds of LLPs, would HRMC frown upon this?
2) From a tax point of view, would the drawings of profits be classed as other operational income to the LTD and would be subject to standard corporation tax?
3) Is the LLP percentage owned an issue? For example if the LTD had a majority stake i.e > 75%
4) If the franchisor LTD company wanted to do promotions (which could include giveaways) to the customers of the LLPs, would this be an issue?
Thanks in advance!
Jack
