Regulation 7 Application of the Principal Regulations to limited liability partnerships

Regulation 5 of the Principal Regulations (companies to which the duty applies) shall read as if the words of that regulation were—

“LLPs to which the duty applies

5.

(1)

These Regulations apply to an LLP in relation to every financial year in which it is a qualifying LLP.

(2)

An LLP is not a qualifying LLP in—

(a)

its first financial year;

(b)

a financial year which began before 6th April 2017.

(3)

An LLP other than a parent LLP is a qualifying LLP—

(a)

in its second financial year if on its last balance sheet date before that financial year it exceeded two or all three of the general thresholds;

(b)

in a subsequent financial year if on both of the relevant balance sheet dates it exceeded two or all three of the general thresholds.

(4)

A parent LLP is a qualifying LLP—

(a)

in its second financial year if on its last balance sheet date before that financial year—

(i)

it exceeded two or all three of the general thresholds, and

(ii)

the group headed by it exceeded two or all three of the group thresholds;

(b)

in a subsequent financial year if on both of the relevant balance sheet dates—

(i)

it exceeded two or all three of the general thresholds, and

(ii)

the group headed by it exceeded two or all three of the group thresholds.

(5)

In this regulation—

(a)

“balance sheet date” means the date as at which the LLP’s balance sheet was made up;

(b)

the “general thresholds” are the maximum figures for an LLP’s turnover, balance sheet total and number of employees set out in subsection (3) of section 465 of the 2006 Act^f1 (as applied and modified by regulation 26 of the 2008 Regulations^f2), determined in accordance with subsections (4) to (6) of that section (as so applied and modified);

(c)

“group” means a parent LLP and its subsidiary undertakings;

(d)

the “group thresholds” are the maximum figures for a group’s turnover, balance sheet total and number of employees set out in subsection (4) of section 466 of the 2006 Act^f3 (as applied and modified by regulation 26 of the 2008 Regulations), determined in accordance with subsections (5) to (7) of that section (as so applied and modified);

(e)

“parent LLP” has the meaning given in section 1173 of the 2006 Act^f4 (as applied and modified by regulation 55 of the 2008 Regulations^f5);

(f)

the “relevant balance sheet dates” are—

(i)

the LLP’s last balance sheet date before the relevant financial year, and

(ii)

the balance sheet date preceding that;

(g)

“subsidiary undertaking” has the meaning given in section 1162 of, and Schedule 7 to, the 2006 Act (as applied and modified by regulation 52 of the 2008 Regulations).

(6)

Paragraph (7) applies if the 2006 Act (as applied and modified by the 2008 Regulations) is amended so that the general thresholds or group thresholds which apply to a financial year (“X”) differ from those which applied to either of the preceding two financial years.

(7)

For the purposes of determining whether an LLP is a qualifying LLP in financial year X, the LLP is to be treated as if the general thresholds or group thresholds which apply to financial year X had also applied to the two preceding financial years.”