WHAT IS LLP INCORPORATION?
The Limited Liability Partnership Act of 2008 established the Limited Liability Partnership (LLP) in India. The primary advantage of a Limited Liability Partnership over a typical partnership business is that one partner is not responsible or liable for the misbehaviour or carelessness of another partner.
A LLP also offers the owners with limited liability protection from the LLP's debts. As a result, all partners in an LLP have limited liability protection for each member inside the partnership, comparable to shareholders in a private limited company. In contrast to the shareholders of a private limited company, the partners of an LLP have the power to operate the firm directly.
In India, an LLP is one of the simplest types of business to establish and administer. Professionals, Micro and Small Businesses that are family owned or tightly held choose LLP due to its straightforward formation process and minimal compliance obligations.
The Limited Liability Partnership (LLP) is a well-known and widely used company form across the world. Customers, vendors, and government agencies prefer to work with LLPs rather than sole proprietorships or traditional partnerships. Limited Liability Partnership is simple to maintain, and no statutory audit is necessary. LLPs are best suited to small businesses. Tax audit is also not necessary for LLPs with less than Rs. 25 lac in capital and less than Rs. 40 lac in sales.
LLP is a separate legal entity that provides the benefits of limited liability of a business as well as the flexibility of a partnership, where no partner is held accountable for the wrongdoing of another partner and their rights and obligations are defined by the LLP agreement. The Limited Liability Partnership Act of 2008 established limited liability partnerships in India.