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How to set up a Limited Partnership in Scotland?

Apr 20, 2017

When starting a business, you should consider Scotland as an interesting option. This is the part of United Kingdom and its business legislation and other conditions are favorable for starting up a company in Scotland. Main legal act that governs all Limited Partnerships in Scotland is a 1907 document that is still topical and useful for business. Setting up a company in Scotland is much cheaper for domestic entrepreneurs but still offshore business is also in advantageous position.

You can spend limited amount of costs per year and function without additional expenses. Diversification between partners in Scottish LP is simple. Limited partners play founders role, have limited liability and general partners bear most responsibilities, and are performing most operational actions. This diversity helps entrepreneurs choose the amount of their liabilities and decide on whether they want to operate the company themselves or not.

It is important to mention taxation rules when you are registering a company in Scotland.

Limited partnerships allow you minimize taxes with a simple scheme. Limited partner in a Scotland company is subject to law profits and the general partner receives most gains. The secret is that general partner is a foreign person who is not a taxation subject according to the UK laws. So, starting a small business in Scotland in form of Limited Partnership is a reasonable and allows you both optimize taxes and use all advantages of legal entity like owning property, signing agreements and even borrow money from banks.

Let us move on to Scottish company formation procedures.

Starting a limited partnership does not even require an address. If you have operational premise and have filed the Registrar of Limited Partnerships – you are nearly done. Important thing is that documents should be filed in Edinburgh only. There are no limits for residence or nationality of partners but according to Scottish company formation rules. there should be at least one limited and one general partner.

Limited partners are more like “passive” investors who have limited liability depending on their assets. On the other hand, general partners bear most responsibility for all company’s debts. According to these differences, it is logical to conduct a partnership agreement, even though it is not obligatory. Business startups in Scotland are mostly formed by entrepreneurs with experience but with professional consultant even young companies can have the ability to develop a rapidly growing company.

Talking about operating a Limited Partnership, it is required to store transaction records and file tax return documents once a year. Mostly, it is associated with need to control and observe financial matters of companies at any moment. Moreover, do not forget to submit documents to HMRC (Her Majesty's Revenue and Customs) when registering company in Scotland. This will assure that you, as a tax-payer, will be protected and will avoid penalties for tax evasion.

Company formation in Scotland can be reduced even to 24 hours if your documents and all necessary papers are filed right.

Governmental organizations support growing business and entrepreneurs can use all advantages of paying most attention to business and not thinking about high tax duties and unnecessary papers or reports. This means starting your own business in Scotland in form of limited partnership is a reasonable idea for entrepreneurs who need to develop and grow their company.

In case you need any legal assistance or help with registration, OffshoreLicense Ltd is ready to help. Professional consultants are ready to explain you how to start business in Scotland. Analyze all details, requirements and perspectives – and this will help you not only to make money but also to become the most reliable company on the market. Effective business always leads to success!

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