Can we run a business through a limited partnership instead of a company?

A limited partnership under the Limited Partnerships Act 2008 has one or more general partners with unlimited liability and limited partners whose liability is limited to their contributions, provided they do not take part in managing the business. It is a separate legal entity, but income and losses can typically flow through to the partners for tax purposes, which is attractive to some investors. The trade-offs include the general partner's unlimited liability, which is usually managed by making the general partner a company, and the restriction that limited partners who become too involved in management risk losing their protection. The structure needs a written partnership agreement and registration. Tax rules for limited partnerships have been tightened, so obtain tax advice before you decide.