Property companies are preparing to turn top earners into self-employed partners to minimise the impact of the Government’s impending higher tax regime. Knight Frank and King Sturge, two of the biggest UK property consultants, are among the limited liability partnerships (LLPs) planning to alter the status of employees to cut their tax bill, before a rise in income tax to 50 per cent on earnings over £150,000. Tax experts said that the move to turn salaried partners into equity partners would shave thousands of pounds off the national insurance bill for the staff member and the company and could also boost profitability as partners take a greater personal stake in the company’s performance. Top earners in the property industry have a basic salary of about £100,000 a year, but can make up to £1 million including bonuses in a good year. Knight Frank has 300 salaried partners in the UK — a fifth of its UK employees, who stand to benefit. Related Links Frenchman soars as LSE shows signs of life Bankers in pay dodges to save bonuses from tax How to ... become a freelance worker The change would mean that partners would pay 8 per cent NICs rather than 11 per cent, and the employer would no longer pay its 12.8 per cent contribution. On a £100,000 salary, the total tax would fall from £16,823 to £3,614, with the employee saving £1,145 on his or her contribution. Mike Warburton, partner at Grant Thornton, the accountant, said: “This has always been an option, but more companies are looking at it more closely because of the 50 per cent tax rate coming in. They want to minimise the overall tax burden.” As equity partners, staff are offered a profit share in lieu of salary. Those switching from salaries to profit shares are likely to be offered a fixed amount equal to their previous earnings, but with greater potential to earn more if the company does well. However, equity partners take on greater risk in exchange for the lower tax bill and earnings potential, losing employee benefits such as membership of a company pension scheme. The move will bring the property companies into line with other professional partnerships, such as lawyers and accountants, which have moved away from having salaried partners since converting to LLP status. Knight Frank began a consultation last week but is not expected to make a further announcement until the end of March. A spokesman for King Sturge confirmed that this was one option that the consultancy was considering.