Comparison Between Partnership Firm and LLP
Below are the various points that show the difference between LLP & Partnership Firm
| Sr. No. | Basis | Partnership Firm | LLP |
|---|---|---|---|
| 1 | Governing Law | Partnership Act, 1932 | Limited liability Partnership Act, 2008 |
| 2 | Registration | Not Compulsory, but it is preferred | Compulsory |
| 3 | Creation | Partner collectively known as Firm, no separate legal status | LLP has separate legal status apart from partners |
| 4 | Legal Status | Partner collectively known as Firm, no separate legal status | LLP has separate legal status apart from partners |
| 5 | Succession | Firm would cease to exist on change in partnership, unless otherwise provided in agreement | LLP would not be affected on change in partnership (Perpetual Succession) |
| 6 | Ownership of Assets | Partnership cannot own assets in its name; assets must be in name of partners | LLP can own assets in its own name |
| 7 | Liability of Partners | Unlimited | Limited |
| 8 | Impact of Action of other partners | Partner is liable and bound by the action of other partners | Partner is not liable and bound by the action of other partners |
| 9 | Body Corporate | Body Corporate cannot become a partner | Body Corporate can become a Partner |