Limited Liability Partnership are prevailed by ‘The Limited Liability Partnership Act, 2008’ and various Rules made thereunder
Partnership is prevailed by ‘The Indian Partnership Act, 1932’ and various Rules made thereunder
Registered under the LLP Act, 2008. The registration is done under the Ministry of Corporate Affairs.
Registered under the Partnership Act, 1932. The registration is done with the Registrar of Firms.
The liability of partners is limited in an LLP mainly because it’s a separate legal entity. The liability of the partners is limited to the amount invested by them in the company.
Partners are personally liable for the unlimited amount of liabilities of the company in a partnership firm.
Number of partners
A minimum of two partners is required. However, a minor cannot be a partner in an LLP
A minimum of two and a maximum of twenty partners are required for a partnership firm. A partnership firm can have a minor as its partner.
Each partner is required to obtain a DPIN (Designated Partner Identification number) before being assigned as a designated partner in an LLP
DPIN is not required for a partnership firm
Shares can be easily transferred to another person after obtaining the consent of all the partners. However, a transferee cannot become a member automatically.
Shares can be easily transferred to another person after the consent of all the partners of the partnership firm. Transferability of partnership is a long process.
An LLP can be converted to a Private Limited Company. But, it cannot be converted back into a partnership firm.
Conversion of a partnership firm to an LLP or a private limited company is a cumbersome process.
Filing of annual return to the Ministry of Corporate Affairs is mandatory.
Annual return filing is not required.
Voluntary or by order of National Company Law Tribunal.
By agreement, mutual consent, insolvency, certain contingencies, and by court order.
Under the partnership firm, every partner owns a share of the business. This type of structure is less expensive and customisable too. On the other hand, an LLP has the advantages of an LLP and a partnership. The partners in an LLP enjoy limited liability.
For more details, call us at +91-9900328729, +91-80-40909797.