Many times startups need to borrow money and take things on credit. In case of normal Partnerships, Partners personal savings and property would be at risk incase business is not able to repay its loans. In an LLP, only investment to start a business is lost, personal assets of the Partners are safe.
Limited Liability Partnership (LLP) is a popular and well known business structure in the world. Corporate Customers, Vendors and Govt. Agencies prefer to deal with LLP instead of proprietorship or normal partnerships.
LLP is easy to manage and statutory audit is not required for Limited Liability Partnership. LLP is most ideal for small enterprises. Tax Audit is also not required for LLPs with capital less than Rs. 25 lac and turnover not exceeding Rs. 40 lac.
LLP continues to exist beyond the existence of its Partners. This is not possible in traditional partnership firms.
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