Accountants, lawyers and GPs who are members of “limited liability partnerships” could be in the firing line come the budget, according to reports in The Times.
As partners are not deemed employees they escape the 15% employer national insurance charge. Chancellor Rachel Reeves is now considering changing this, and it could raise a whopping £2bn (based on 2020 figures, so it could be much more!).
Tax expert Dan Neidle (pictured) says taxing people differently just because of their choice of legal vehicle is “irrational and there’s certainly a principled justification for equalising the position”.
He went on: “This is something any Chancellor should consider.”
Neidle also pointed out that is also achieves the political aim of mostly affecting only high earners – around 1% of taxpayers receive 46% of all LLP income, and 98% of the tax raised would come from the highest earning 19% of taxpayers.
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