What are the advantages and disadvantages of Limited Liability Partnership or LLP?

A comparison between LLP and Pvt. Ltd. Co. can be drawn on the basis of various parameters to decide which suits whom the best. There exist many disadvantages and advantages of LLP or Limited Liability Partnership, namely:

ADVANTAGES:

  • Simplified incorporation procedure with a minimal fee.
  • Limited liability of partners.
  • Perpetual succession.
  • Decision-making power is in hands of directors.
  • Transferable and heritable.

DISADVANTAGES:

  • Less recognized owing to recent introduction.
  • Less credibility
  • Tax benefits not provided by many States.
  • Mutual trust necessary to ensure smooth functioning. Discord amongst partners affects the firm indirectly.

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