What is a Limited Liability Partnership?
Limited Liability Partnership is a business firm with limited liability. LLP is giving you the advantage of Company and Partnership. LLP was passed under the Limited Liability Partnership Act of 2008. This type of firm is superior to the traditional Partnership. In this case, a single person is not responsible for any misconduct. LLP does not have the concept of shared capital but partners' contributions.
Advantages of an LLP over a Partnership Firm
- Here are some of the benefits of registering your Partnership Business as an LLP in India:
- An LLP is a unique form of Business in which partners are limited to their capital contribution
- LLP requires fewer compliance formalities
- Business is flexible because partners can decide how they will individually contribute to the business operations
- LLP is beneficial because no tax is levied on the distribution of profits among the partners
Duties and Rights of the Partner in LLP
- The Limited Liability Partnership Act of 2008 defines the following rights as well as duties of an LLP in India:
- In LLP, each partner has the right to take part in the conduct of Business
- In LLP, every partner has the right to access a copy of the books of account
- In LLP, every partner is bound to attend diligent duties in the conduct of Business
- In the LLP business, there are factors similar to the corporate such as legal duties and obligations of limited partners
- Partners in a limited liability partnership have a full managerial function
- The difference in the process of ordinary matters may decide by the majority of the partners
- Every partner has the right to present their opinion before the matter is decided
- The legal representative has the right to access it in case the partner dies
- The legal right of partners is the capacity to transact business with the limited liability partnership
- Partners accept full personal responsibility for a partnership liability
- Partners have the right to vote without incurring liability. They are allowed to vote for amendments and dissolution.
- Partners have the right to vote for fundamental changes
- Property rights are according to the development in the system of capital
Authority extended to LLP's Member Partners
- The Limited Liability Partnership Act of 2008 also extends the following authorities to the member partners of an LLP in India:
- Submission of the dispute related to the Business
- Partners can open an Account on behalf of their name
- Compromise and relinquish any portion by the claim of LLP
- The suit can be withdrawn on behalf of the LLP
- Acquire and transfer immovable property of LLP
If you wish to know more about the Limited Liability Partnerships as well as their registration procedure, then you can consult with one of our Incorporation Experts at Registrationwala.
