Service Details

Partnerships are the most common business structure for businesses that have more than one owner. Many businesses, ranging from retail stores to accounting firms, are structured as partnerships. A business partnership is a for-profit business established and run by two or more individuals. The Limited Liability Partnership organization has been introduced in India by way of Limited Liability Partnership Act, 2008. In an LLP one partner is not responsible or liable for another partner's misconduct or negligence, this is an important difference from that of a unlimited partnership. In an LLP, all partners have a form of limited liability for each individual's protection within the partnership, similar to that of the shareholders of a Company. However, unlike corporate shareholders, the partners have the right to manage the business directly. An LLP also limits the personal liability of a partner for the errors, omissions, incompetence, or negligence of the LLP's employees or other agents. LLP cannot raise money from Public.

Limited Liability Partnership is managed as per the LLP Agreement, however in the absence of such agreement the LLP would be governed by the framework provided in Schedule 1 of Limited Liability Partnership Act, 2008, which describes the matters relating to mutual rights and duties of partners of the LLP and of the limited liability partnership and its partners.

LLP is a separate legal entity and the liability of the partners would be limited to their agreed contribution in the LLP. Further, no partner would be liable on account of the independent or un-authorized actions of other partners, thus allowing individual partners to be shielded from joint liability created by another partner’s wrongful business decisions or misconduct.

Futures of LLP as follows:

• Low cost of Formation.
• Easy to establish.
• Easy to manage & run.
• No requirement of any minimum capital contribution.
• No restrictions as to maximum number of partners.
• LLP & its partners are distinct from each other.
• Partners are not liable for act of partners.
• Less Compliance level.
• No exposure to personal assets of the partners except in case of fraud.
• Fewer requirements as to maintenance of statutory records.
• Fewer Government Intervention