Limited Liability Partnership (LLP)
Limited Liability partnership is one of the latest model of business entity.Which was introduced by way a new act called Limited Liability Partnership Act 2008.This mode of entity has the benefits of Private Limited and Partnership.The LLP mode enables the parties to maintain the business while providing the advantage of Limited liability.
In Limited Liability Partnership liability of each partners are limited unlike traditional partnership.Which makes clear that in a LLP,one Partners is not liable for misconduct of another partner.
Limited liability liability also protect the partners from the debt of the LLP.In the traditional partnership or private Limited there is upper cap on the maximum number of members where as there is no such maximum limit in the number of members in an LLP.
The incorporation and business management of an LLP is very simple.The requirement of Statutory audit is not required for an LLP, Where the paid up capital and turnover is less than 25 Lakh and 40 Lakhs respectively.The LLP mode is better for MSME,Professional,Consultant and Service oriented businesses.