Taking on partners Lawyers and GPs may be in Reeves' sights

Lawyers, accountants and doctors are in the line of fire at the budget as Rachel Reeves considers ending an exemption on employer national insurance contributions (NICs) for partnerships.

- Lauren Almeida

The chancellor has repeatedly warned that those with the “broadest shoulders” should pay their fair share of tax, and insiders say she is planning a raid on limited liability partnerships (LLPs) on 26 November.

So how would it work, how much would it raise and why were some partnerships not paying employer NICs in the first place?

What is the government proposing?

More than 190,000 people work in an LLP. Partners pay income tax on profits as they arise, but they are considered self-employed and therefore do not pay any employer’s national insurance. It would otherwise be levied at 15% on their income.

Reeves is said to consider this unfair and is expected to levy a rate that would be slightly lower on partners, according to government sources first reported by the Times.

Who would it hit?

Lawyers, accountants, doctors and others who typically work in a partnership structure.

The Centre for the Analysis of Taxation (CenTax) thinktank found that solicitors receive a fifth of all partnership income, averaging more than £300,000 each in partnership profits annually. The average is £118,000 a year for GPs, and £246,000 for accountants.

Last year, the partners at these firms escaped Reeves’s last change to employer NICs, which were raised to 15% from April 2025.

The proposed change could mean much higher tax contributions from senior lawyers at big firms, who can take home multimillion pound pay packets. Many City law firms operate as LLPs, including Linklaters, Clifford Chance and Freshfields.