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The presumption of self-employment is removed for some members of LLPs in order to tackle the disguising of employment relationships through LLPs¹. These rules target 'salaried members' – ie those members working for an LLP on terms that are tantamount to employment.

These rules are targeted anti-avoidance provisions, applying to individual members only (not corporates) that perform services for the LLP.

Broadly they ensure that if all of conditions A, B and C are met, an individual member (M) of an LLP is treated as being employed by the LLP under a contract of service instead of being a member of the partnership.

Conditions A, B and C are discussed fully below, but in summary they are as follows:

1. Ìý

   •ÌýÌýÌýÌý Condition A – there are arrangements in place such that a 'disguised salary' is payable to M in return for their services – a disguised salary is essentially a fixed amount, or an amount that is variable but not by reference to the partnership profits

2. Ìý

   •ÌýÌýÌýÌý Condition B – M does not have