A company where two or more people share ownership of the business is a partnership company. In a partnership company, each partner contributes to all aspects of the business. The partners also share the profits and losses of the business. Whereas LLP, which is limited liability partnership, is a company where all partners have limited liabilities. Here, one partner is not responsible for other partners’ diligence or negligence.

Therefore, those of you who want to be on the safe side when doing business, it’s a good idea to convert your Partnership into a Limited Liability Partnership. By doing so, you’re going to combine the partnership aspect of a firm with the Limited Liability Aspect of a company.

Advantages of LLP

Limited liability protection is one of the main advantages that make partners look for conversion from Partnership to LLP.

It is an interesting and top choice for small and medium sized businesses as it is a great way to bring business synergies together.

It forms a simple working condition limiting liability to partners.

The existence and running of LLP does not solely depend on either of the partner. For example, with the demise of a partner in Partnership Company may cause the company to disintegrate. Whereas, in LLP, it may not cease to exist in such a case. The partners of an LLP may keep changing from time to time and it will not affect the LLP’s continuity.

The liability of partners in LLP is limited to the amount of capital invested and there is no minimum limit to the amount of capital to be invested.

In a partnership firm, minimum number of partners is two and maximum is limited to ten. However in LLP, there is no upper limit to number of partners.

LLP’s can be merged with other LLPs unlike Partnership Companies.