{"id":366,"date":"2018-06-28T07:17:30","date_gmt":"2018-06-28T07:17:30","guid":{"rendered":"https:\/\/companyregistrationonline.in\/?p=366"},"modified":"2020-12-31T06:57:49","modified_gmt":"2020-12-31T06:57:49","slug":"difference-private-limited-company-llp","status":"publish","type":"post","link":"https:\/\/companyregistrationonline.in\/blog\/difference-private-limited-company-llp\/","title":{"rendered":"Difference between Private Limited Company and LLP"},"content":{"rendered":"<p>[fusion_builder_container hundred_percent=&#8221;no&#8221; equal_height_columns=&#8221;no&#8221; menu_anchor=&#8221;&#8221; hide_on_mobile=&#8221;small-visibility,medium-visibility,large-visibility&#8221; class=&#8221;&#8221; id=&#8221;&#8221; background_color=&#8221;&#8221; background_image=&#8221;&#8221; background_position=&#8221;center center&#8221; background_repeat=&#8221;no-repeat&#8221; fade=&#8221;no&#8221; background_parallax=&#8221;none&#8221; parallax_speed=&#8221;0.3&#8243; video_mp4=&#8221;&#8221; video_webm=&#8221;&#8221; video_ogv=&#8221;&#8221; video_url=&#8221;&#8221; video_aspect_ratio=&#8221;16:9&#8243; video_loop=&#8221;yes&#8221; video_mute=&#8221;yes&#8221; overlay_color=&#8221;&#8221; video_preview_image=&#8221;&#8221; border_color=&#8221;&#8221; border_style=&#8221;solid&#8221; padding_top=&#8221;&#8221; padding_bottom=&#8221;&#8221; padding_left=&#8221;&#8221; padding_right=&#8221;&#8221; type=&#8221;legacy&#8221;][fusion_builder_row][fusion_builder_column type=&#8221;1_1&#8243; layout=&#8221;1_1&#8243; background_position=&#8221;left top&#8221; background_color=&#8221;&#8221; border_color=&#8221;&#8221; border_style=&#8221;solid&#8221; border_position=&#8221;all&#8221; spacing=&#8221;yes&#8221; background_image=&#8221;&#8221; background_repeat=&#8221;no-repeat&#8221; padding_top=&#8221;&#8221; padding_right=&#8221;&#8221; padding_bottom=&#8221;&#8221; padding_left=&#8221;&#8221; margin_top=&#8221;0px&#8221; margin_bottom=&#8221;0px&#8221; class=&#8221;&#8221; id=&#8221;&#8221; animation_type=&#8221;&#8221; animation_speed=&#8221;0.3&#8243; animation_direction=&#8221;left&#8221; hide_on_mobile=&#8221;small-visibility,medium-visibility,large-visibility&#8221; center_content=&#8221;no&#8221; last=&#8221;true&#8221; min_height=&#8221;&#8221; hover_type=&#8221;none&#8221; link=&#8221;&#8221; border_sizes_top=&#8221;&#8221; border_sizes_bottom=&#8221;&#8221; border_sizes_left=&#8221;&#8221; border_sizes_right=&#8221;&#8221; type=&#8221;1_1&#8243; first=&#8221;true&#8221;][fusion_text]<\/p>\n<p style=\"text-align: justify;\">Since the concept of LLP has been introduced in India, apart from incorporating a traditional <strong><a href=\"https:\/\/companyregistrationonline.in\/blog\/private-limited-company\/\">Private Limited Company<\/a><\/strong>, it has become an option for the entrepreneurs, business owners, and the investors who are starting their new ventures to start their business as an LLP. In the light of this, it is important to understand the advantage of each of these, for example, the formations, the differences between them and to consider it carefully which ones suit the need of the business best. However, mentioned below is the Difference between Private Limited Company and LLP.<\/p>\n<h2>Difference between Private Limited Company and LLP<\/h2>\n<h2 style=\"text-align: justify;\"><strong>Incorporation<\/strong><\/h2>\n<p style=\"text-align: justify;\">The basic difference between a <strong><a href=\"https:\/\/companyregistrationonline.in\/blog\/private-limited-company\/\">Private\u00a0Limited company<\/a><\/strong> and LLP based on the Incorporation of the company is:<\/p>\n<ul style=\"text-align: justify;\">\n<li><strong>In LLP \u2013 <\/strong>For the formation of an LLP, a minimum of 2 Partners are required. Hence, There is no limit to the maximum number of Partners. A body corporate can be a member of an LLP as well.<\/li>\n<li><strong>In Private Company &#8211;<\/strong> The minimum number of the shareholder that is required for a company is 2 and there can be up to 200 shareholders, in the case of a <strong><a href=\"https:\/\/companyregistrationonline.in\/blog\/private-limited-company\/\">private limited company<\/a><\/strong>.<\/li>\n<li>\n<h2><strong>The difference in taxation<\/strong><\/h2>\n<p>The basic difference between <strong><a href=\"https:\/\/www.legalraasta.com\/private-limited-company-registration\/\">Private Limited Company<\/a><\/strong> and LLP based on Taxation on companies is:<\/li>\n<\/ul>\n<ul style=\"text-align: justify;\">\n<li>A <a href=\"https:\/\/www.legalraasta.com\/llp-registration\/\"><strong>Limited Liability Partnership<\/strong><\/a> is only subjected to income tax and alternative minimum tax. Whereas\u00a0<strong><a href=\"https:\/\/companyregistrationonline.in\/blog\/private-limited-company\/\">Private Limited Company<\/a><\/strong>\u00a0is liable to pay various taxes that are on the income tax, dividend distribution tax, and the minimum alternate tax.<br \/>\n<h2><span style=\"text-decoration: underline;\"><strong>Registration<\/strong><\/span><\/h2>\n<\/li>\n<\/ul>\n<ul style=\"text-align: justify;\">\n<li><strong>In LLP<\/strong> \u2013 Compulsory registration is required along with the ROC.<\/li>\n<li><strong>In Company<\/strong> \u2013 Company registration is required along with the ROC. As well as the Certificate of Incorporation is conclusive evidence.<br \/>\n<h2><span style=\"text-decoration: underline;\"><strong>Foreign Investment<\/strong><\/span><\/h2>\n<\/li>\n<li><strong>LLP \u2013\u00a0<\/strong>The Foreign investment in LLPs has been allowed from May 11, 2011, but it is restricted only to those sectors where 100% foreign investment for the companies is permitted, and which do not have any performance-linked conditions. Thus, All the foreign investment in <strong><a href=\"https:\/\/companyregistrationonline.in\/blog\/llp-meaning-llp-act-llp-india\/\">LLP<\/a><\/strong> is on an approval basis.<\/li>\n<li><strong>Company \u2013 <\/strong>Foreign investment is allowed on an automatic or approval basis on the various sectors under the \u00a0FDI policy. However, there are percentage restrictions, as well as the performance-linked conditions, such as the minimum capitalization in various sectors.<br \/>\n<h2><strong>Liability of shareholders\/\u00a0<\/strong><strong>LLP<\/strong><strong>\u00a0partners<\/strong><\/h2>\n<ul>\n<li><strong>LLP \u2013\u00a0<\/strong>The liability of the shareholders is limited to the extent of the contribution to the<strong><a href=\"https:\/\/companyregistrationonline.in\/blog\/llp-meaning-llp-act-llp-india\/\"> LLP<\/a><\/strong>.<\/li>\n<li><strong>Company \u2013<\/strong> The liability of the shareholders is limited to the extent of the unpaid capital.<br \/>\n<h2><strong>Foreign Investment<\/strong><\/h2>\n<\/li>\n<\/ul>\n<ul>\n<li><strong>LLP \u2013\u00a0<\/strong>The Foreign investment in LLPs has been allowed from May 11, 2011, but it is restricted only to those sectors where 100% foreign investment for the companies is permitted, and which do not have any performance-linked conditions. All the foreign investment in LLP is on an approval basis.<\/li>\n<li>Company \u2013 <a href=\"https:\/\/companyregistrationonline.in\/blog\/fdi-private-limited-company\/\">Foreign investment<\/a> is allowed on an automatic or approval basis on the various sectors under the \u00a0FDI policy. There are percentage restrictions, and also performance-linked conditions, such as the minimum capitalization in various sectors.<br \/>\n<h2><span style=\"text-decoration: underline;\"><strong>Capital contribution<\/strong><\/span><strong>\u00a0 <\/strong><\/h2>\n<\/li>\n<li><strong>LLP \u2013\u00a0<\/strong>In<strong><a href=\"https:\/\/companyregistrationonline.in\/blog\/llp-meaning-llp-act-llp-india\/\"> LLP<\/a><\/strong> there is no as such capital<\/li>\n<li><strong>\u00a0Company \u2013 \u00a0<\/strong>In a\u00a0<a href=\"https:\/\/www.legalraasta.com\/private-limited-company-registration\/\"><strong>Private Limited company<\/strong><\/a>, there should be a minimum paid-up capital of Rs.1 lakh.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><strong>\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0<\/strong><strong>Foreign Investment<\/strong><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"text-align: justify;\"><strong>LLP \u2013 <\/strong>The Foreign investment in <strong><a href=\"https:\/\/companyregistrationonline.in\/blog\/llp-meaning-llp-act-llp-india\/\">LLP<\/a><\/strong>s has been allowed from May 11, 2011, but it is restricted only to those sectors in which 100% foreign investment for the companies is permitted, and which do not have any performance-linked condition. All the foreign investment in <strong><a href=\"https:\/\/companyregistrationonline.in\/blog\/llp-meaning-llp-act-llp-india\/\">LLP<\/a><\/strong> is on an approval basis.<\/li>\n<li><strong>Company \u2013 <\/strong>Foreign investment is allowed on an automatic or approval basis on the various sectors under the \u00a0FDI policy. Therefore, there are percentage restrictions, and also performance-linked conditions, such as the minimum capitalization in various sectors.<br \/>\n<h2><strong><span style=\"text-decoration: underline;\">Audit<\/span><\/strong><\/h2>\n<\/li>\n<\/ul>\n<ul style=\"text-align: justify;\">\n<li><strong>LLP<\/strong> \u2013 Auditing is Required, if the contribution is above Rs.25 lakhs or if the LLP\u2019s annual turnover is above Rs.40 lakhs.<\/li>\n<li><strong>Company<\/strong> \u2013 Audit is Compulsory, However, irrespective of the share capital and the turnover.<br \/>\n<h2><strong>Foreign Nationals as shareholder \/ Partner<\/strong><\/h2>\n<\/li>\n<\/ul>\n<ul>\n<li style=\"text-align: justify;\"><strong>LLP \u2013 <\/strong>Foreign nationals can be partners.<\/li>\n<li style=\"text-align: justify;\"><strong>Company \u2013 <\/strong>The<strong> \u00a0<\/strong>Foreign nationals can be shareholders.<\/li>\n<\/ul>\n<p><strong>Related Article<\/strong>&#8211;<\/p>\n<p class=\"entry-title fusion-post-title\" data-fontsize=\"30\" data-lineheight=\"27\"><a href=\"https:\/\/companyregistrationonline.in\/blog\/difference-between-private-limited-section-8-nidhi-company\/\">What is the difference between Private Limited, Section 8 &amp; Nidhi Company?<\/a><\/p>\n<p class=\"entry-title fusion-post-title\" data-fontsize=\"30\" data-lineheight=\"27\"><a href=\"https:\/\/companyregistrationonline.in\/blog\/advantages-of-private-limited-company\/\">Advantages of Private Limited Company<\/a><\/p>\n<p class=\"entry-title fusion-post-title\" data-fontsize=\"30\" data-lineheight=\"37\"><a href=\"https:\/\/www.legalraasta.com\/blog\/llp-better-private-limited-company\/\">Why LLP is better than Private Limited Company<\/a><\/p>\n<p data-fontsize=\"30\" data-lineheight=\"27\"><strong>Visit <a href=\"https:\/\/companyregistrationonline.in\">Company Registration Online<\/a> for registration of your company today.<\/strong><\/p>\n<p>[\/fusion_text][\/fusion_builder_column][\/fusion_builder_row][\/fusion_builder_container]<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[fusion_builder_container hundred_percent=&#8221;no&#8221; equal_height_columns=&#8221;no&#8221; menu_anchor=&#8221;&#8221; hide_on_mobile=&#8221;small-visibility,medium-visibility,large-visibility&#8221; class=&#8221;&#8221; id=&#8221;&#8221; background_color=&#8221;&#8221; background_image=&#8221;&#8221; background_position=&#8221;center center&#8221; background_repeat=&#8221;no-repeat&#8221; fade=&#8221;no&#8221; background_parallax=&#8221;none&#8221; parallax_speed=&#8221;0.3&#8243; video_mp4=&#8221;&#8221; video_webm=&#8221;&#8221; video_ogv=&#8221;&#8221; video_url=&#8221;&#8221; video_aspect_ratio=&#8221;16:9&#8243; video_loop=&#8221;yes&#8221; video_mute=&#8221;yes&#8221; overlay_color=&#8221;&#8221; video_preview_image=&#8221;&#8221; border_color=&#8221;&#8221;  [&#8230;]<\/p>\n","protected":false},"author":1,"featured_media":1354,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[558],"tags":[400,48],"class_list":["post-366","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-company-registration","tag-difference-between","tag-limited-liability-partnership"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.2 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Difference between Private Limited Company and LLP | LegalRaasta<\/title>\n<meta name=\"description\" content=\"Difference between Private Limited Company and LLP A Limited Liability Partnership is only subjected to income tax and alternate minimum tax. 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