LLPs for Medical Professionals - Your Questions Answered

The popularity of medical Limited Liability Partnerships (LLPs) is on the rise, particularly as hospitals navigate ways in which to reduce the patient backlogs. However, the lack of clear information can be a barrier for doctors/consultants considering this model. Here, we answer some of the most frequently asked questions:

1. Why are LLPs ideal for medical consultants?

LLPs offer several advantages for forming a medical business with colleagues:

• Limited Liability:?Protects your personal assets, similar to a limited company.
• Flexible Structure:?Adapts well to the working style of doctors.
• Confidentiality:?Internal management and payment structures are private to LLP members

2. Do I join as an individual?

No, you have the flexibility to join an LLP as either an individual (e.g., John Smith) or a limited company (e.g., John Smith Limited).

3. What about limited liability?

Yes, just like in a limited company, LLP members enjoy limited liability protection.

4. Does an LLP have shares and pay dividends?

Unlike a limited company, LLPs don't have shares or pay dividends. A key document called the LLP Members Agreement details how the partnership operates, including compensation and profit distribution, specific to each LLP. This agreement should be comprehensive and tailored to your specific needs and practice type.

5. How is the LLP taxed?

The LLP itself doesn't have a tax liability, unlike a limited company which is subject to corporation tax. Members are taxed on their earnings at the point of receipt from the LLP. Individual members report their earnings as self-employed income, while corporate members pay tax through their limited company.

6. What types of contracts can an LLP undertake?

Consultant LLPs can contract with various entities, including:

• NHS Trusts
• Private Hospitals
• ICBs/Primary care

Importantly, the commissioner contracts with the LLP as a single entity, not individual consultants. This allows the LLP to assign any qualified and skilled member to complete the contracted work.

Considering an LLP?

We hope this information clarifies some of the key aspects of LLPs for medical professionals. If you're considering forming an LLP or have questions about navigating the process, Trust Health would be delighted to help. We offer expert guidance and support to ensure a smooth transition for you and your colleagues.

Visit our website www.trusthealth.co.uk for more information or call 01403 241484 to arrange a time to have a chat with us.

Contact us today to discuss how an LLP can empower your medical practice.