Stuck in an LLP? How we put the power back in your hands
It’s no secret that access to invoice funding is a key factor in unlocking your agency’s potential to grow. That’s why businesses waste no time in securing the best deal to get their cash flowing – with many turning to a Limited Liability Partnership (LLP) model, otherwise known as an introducer or funder principal model.
This is where an agency invoices clients and pays workers in the funder’s name, not in their own company name. Yet in the eagerness to secure a deal, this vital factor is often brushed over. Before you know it, you could be locked into an agreement that ends up heavily limiting your business – when you could be limitless, by having everything done on your behalf and in your name.
If you’re stuck in an LLP or similar arrangement – or you’re considering entering one – there is a better option. Let’s take a closer look at LLPs and how we can put the power back in your hands.
The LLP trap
When selling the benefits of LLPs, providers can exaggerate the delays and difficulties of applying for VAT, PAYE or CIS gross status. Some recruiters may even be told that LLP models are ‘risk free’.
Unwittingly, agencies find themselves stuck in a scenario where the restrictions outweigh the benefits…
The harsh reality
Agency owners often set up independently after becoming frustrated by previous employers. The aim? To operate on their own terms, showcasing their own values, under their own name. Yet those signed up to an LLP often find much less independence and freedom than they first imagined.
Not being able to use your own name and logo on payslips is an outcome that’s all too familiar for agencies like yours. As a growing organisation in a competitive market, powerful branding is a key ingredient to winning new business. Yet when your LLP provider takes the limelight on invoices, this is confusing to clients and candidates, and a blow for your brand awareness. This can make you appear small, potentially limiting your future opportunities.
Crucially, this means your turnover isn’t actually yours – you operate in your funder’s shadow. The threshhold for CIS gross status when your only turnover is your margin payment is even further away – a delay that you were supposed to have been protected against. There are also serious financial implications for the company and directors when it comes to qualifying for grants or applying for loans.
Time and time again we see agencies shackled in long-term LLP traps that were supposed to be short-term fixes. But it doesn’t have to be this way.
A real solution
Whether you’re an emerging start-up or a developing agency, you want the best funding option possible to help your recruitment business thrive. For most, that means forging a strong brand presence, maintaining independence, and finding the freedom to flex your growth muscles.
With Easypay as your funding provider, you can achieve all this and more. We put your brand first, offering 100% recruitment finance and operating entirely in the name of your agency. This means your business, name and logo will be on every invoice and payslip. All turnover will be in your name too, allowing you to build a valuable asset.
If needed, we can apply for VAT and PAYE on your behalf, and guide you through the CIS process to help you achieve gross status rapidly, so no deductions are made. We’ll even assist with forming your company if you need us to. It’s all part of our integrated recruitment funding and back-office solutions.
This doesn’t just apply to new agencies either. Many recruiters unwittingly operate on these models for years – they don’t know an alternative, and imagine that moving will be complicated and problematic. Instead, they realise they’re paying unnecessary expenses, such as the apprenticeship levy on all their payroll, as their funder’s payroll is in excess of £3m per year. At Easypay, we’ll help you get everything in place – your only question will be ‘why didn’t I do this sooner?’.
Reclaim your independence with us
Our support is entirely bespoke and completely seamless. It puts you centre stage in front of hiring managers, giving you the power you need to make a name and grow. To see how we can help, get in touch today and let’s discuss your future as an independent agency.