When starting a business, choosing the right business form can be a confusing task for entrepreneurs. The two most common business forms are Private Limited Company and Limited Liability Partnership.

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When starting a business, choosing the right business form can be a confusing task for entrepreneurs. The two most common business forms are Private Limited Company and Limited Liability Partnership.

What is a Limited Liability Partnership (LLP)?

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A PLC is a business form that provides limited liability protection to its shareholders. It can be established with at least two people and has a maximum limit of 200 shareholders.

What is a Private Limited Company (PLC)?

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• LLP is cost-effective compared to PLC • Less statutory compliance requirements for LLPs • LLPs can have an unlimited number of members • LLP requires fewer meetings compared to PLC • LLP has tax advantages over PLC

Benefits of LLP over PLC

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• Both require a minimum of two members or shareholders to start the incorporation process. • Both provide limited liability protection to the members or shareholders. • Both are separate legal entities from their members or shareholders.

Similarities between LLP and PLC

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Before choosing a business form, entrepreneurs should consider their business needs and future plans. LLP may be a better choice for those looking for a flexible and cost-effective option, while PLC may be suitable for larger businesses with more complex structures.

Conclusion

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