LLP stands for Limited Liability Partnership. It is a partnership where the partners have limited liability, similar to shareholders in a private limited company.
LLP registration requires at least two partners and does not have a maximum limit on the number of partners.
The liability of the partners limit to their agreed contribution in the LLP. They are not personally liable for the debts or liabilities of the LLP.
LLPs comes under governance of the LLP Act and the registration process involves filing an application with the Registrar of Companies.
LLP typically suit professional services firms, small and medium-sized enterprises, and businesses where partners want to have limited liability and flexibility in management.
LLPs do not have required to hold annual general meetings or maintain as many compliance requirements as private limited companies.
Private Limited (Pvt Ltd) Registration:
A private limited company is a separate legal entity distinct from its owners/shareholders.
Pvt Ltd registration requires a minimum of two directors and two shareholders, with a maximum limit of 200 shareholders.
The liability of the shareholders exists to the amount unpaid on their shares and they are not personally liable for the company’s debts.
Private limited companies are governed by the Companies Act and the registration process involves filing an application with the Registrar of Companies (ROC).
Pvt Ltd companies are suitable for businesses looking for a separate legal entity, limited liability, ease of raising funds, and scalability.
Pvt Ltd companies have more stringent compliance requirements. It includes such as holding annual general meetings, filing annual financial statements and complying with corporate governance norms.
To visit https://www.mca.gov.in
Both LLPs and Pvt Ltd companies have their advantages and disadvantages. The choice depends on various factors such as the nature of the business, number of partners/shareholders, liability preferences, scalability goals, and compliance capabilities. Therefore, It is advisable to consult with a professional, such as a company secretary or a lawyer. They will help to understand the specific implications and requirements. That depends each form of registration and make an informed decision based on your business needs.
For further details access our website https://vibrantfinserv.com
