LLP Vs Private Limited Company

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This presentation would shows "How LLP is different from Private Limited company".

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Slide 1:

PRESENTS

LIMITED LIABILITY PARTNERSHIP PRIVATE LIMITED COMPANY:

LIMITED LIABILITY PARTNERSHIP PRIVATE LIMITED COMPANY

Registration Procedure:

Registration Procedure The registration procedure are similar to both the entities apart from filing of forms. Procedure to incorporate are : Obtaining DSC for proposed director Obtaining DIN for the proposed director Obtaining name approval from the MCA. Filing forms for incorporation.

Registration cost:

Registration cost Since LLP have been introduced in INDIA to enhance small business entrepreneurs the fees for incorporating a Limited Liability Partnership is cheap when compared to that of a Private limited company .

Transfer of Shares:

Transfer of Shares Both LLP and Private Limited Company have similar feature expect for the ownership and the transferability. Where transferring of shares is more flexible in the Private Limited companies than LLP’S

Ownership :

Ownership The distinction between ownership and management is more clear and flexible in the case of Private companies whereas there is no distinction in case of LLP’s. Generally a Private limited company is recommended for any business considering FDI or ESOP.

Compliance :

Compliance Tax compliance are similar for both the entities. The compliance with Ministry of corporate Affairs is different for both the entities where LLP need not file its accounts in case if its capital contribution is less than 25 lakhs and turnover is less than 40 lakhs . In case of Private limited company it has to compulsorily file all its audited accounts with the ROC.

Fines and penalties :

Fines and penalties In case of an LLP, non compliance with the MCA will lead to a Flat fee of Rs 100 per day in the event of continuing offence. It is important for the promoter to be aware of the due dates and required documents for filing with the registrar on time.

Conclusion :

Conclusion Private Ltd company is in existence for a longer time than LLP hence there is well established procedure for a Private Company than a LLP. Since LLP was recently introduced in INDIA the rules regulations and procedure are still evolving. Private Ltd company offers its promoters a better image or standing than that of a LLP and also it enjoys a better access to funding from banks and foreign direct investment.

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