ARTICLE · 19 APRIL 2024

Salaried Members Rules: Recent Changes And The Bluecrest Decision Revisited

Lubbock Fine

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We reported in our recent blog about HMRC's published changed of approach to Condition C of the salaried member rules.

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Matthew Spencer

We reported in our recent blog about HMRC's published changed of approach to Condition C of the salaried member rules. As this change may make it more difficult for some LLP's to rely on failing Condition C, it's a useful time to review the case law developments in 2023 to Condition B – Significant Influence.

In the case of HMRC v Bluecrest Capital Management (UK) LLP, the Upper Tribunal (UT) partly ruled against HMRC's appeal on the application of the salaried member rules. This article explores some of the case's intricacies and delves into the implications it carries for LLPs in structuring and defining the roles of their members.

Recap on salaried member rules

The salaried member rules were introduced by HMRC to counteract the misclassification of LLP members as self-employed, preventing tax avoidance. These rules target members whose roles resemble employees rather than traditional partners in a partnership, subjecting them to PAYE income tax and National

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