LLP stands for Limited Liability Partnership.
Limited Liability Partnership (LLP)
An LLP is a business structure that combines elements of both partnerships and companies. It provides the flexibility of a partnership with the benefit of limited liability for its partners. Here are some key points about LLPs:
Limited Liability: Partners in an LLP have limited liability, meaning they are not personally responsible for the debts or liabilities of the LLP beyond their agreed contribution.
Separate Legal Entity: An LLP is considered a separate legal entity from its partners, allowing it to enter into contracts, own property, and be sued in its own name.
Flexibility: It offers flexibility in terms of management and operations, similar to a traditional partnership, while providing protection against personal liability.
Regulation: LLPs are regulated by the Limited Liability Partnership Act, 2008 in India.
Key Features of LLP
Liability Protection: Partners are protected from personal liability for the LLP’s debts and obligations.
Management: LLPs can be managed by designated partners who are responsible for the day-to-day operations.
Taxation: LLPs are taxed as a partnership firm, meaning profits are taxed at the firm level, and partners are taxed on their share of the profits.
Compliance: LLPs must comply with certain regulatory requirements, including filing annual returns and maintaining proper accounting records.
For more details about LLPs and their formation, you can refer to the Ministry of Corporate Affairs (MCA) website.
Comments