Different between Private limited company or LLP
You all already know about Limited Liability Partnership (LLP) and Private Limited Company. Today we will discuss which is better between Limited Liability Partnership and Private Limited Company. And another bonus tip is that you should use Private Limited Company for any business and Limited Liability Partnership Registration for any business.
Shareholder or member
In case of limited liability partnership, the minimum shareholders can be two and there is no maximum limit. But in case of a private limited company, the minimum number of shareholders should be two and the maximum number of shareholders may be 200. This is in the case of a Benefit Point Limited Liability Partnership.
Compliance (Tax and audit)
Liability for partnership
Limited liability Partnership (LLP)
In LLP there is only one agreement and that is exactly how the company will run, here you do not have to do as much as in a private limited company.
Private Limited Company
In a private limited company you have to submit a lot of documents, here you need documents like Memorandum of Association (MoA), articles of association (AoA, called articles of incorporation in some jurisdictions) and a shareholder agreement which says what are the responsibilities of the shareholders?
Owner and management
Owner and management is the same in case of limited liability partnership. But in the case of a private limited company, the owner and management are different. If Owners are A, B, C then Management is X, Y, Z. Private Limited Company is a Proper Structure Organization. For any investor, invest in a private limited company.
If you ever need to invest in the future, the limited liability partnership will not be able to register on the stock exchange. But private limited companies can register on the stock exchange. This is in the case of a Benefit Private Limited Company.
Limited liability partnership
If you want to start working with a professional partner and do not want to make a lot of compliance’s. Because the cost with compliance’s is high, you should definitely register LLP.
Private Limited Company
If you want to give your company a proper structure, you should definitely register a private limited company. The benefit of this is that they have limited liability in the Limited Liability Partnership but in a private limited company a proprietor shareholder agreement comes, if you want to give your employee a stock option you can give another. In the future, if you want to list your company on a stock exchange, you can do that which you cannot do in a limited liability partnership.
You can contact us if you want to know more about Limited Liability Partnership and Private Limited Company.