A Limited Liability Partnership (LLP) is a business structure that combines the best aspects of a
partnership and a company, offering flexibility in management while protecting individual partners from
personal liability. In an LLP, the partners' liability is limited to the capital they have invested in
the business, which means that their personal assets are not at risk for the company’s debts. This
structure is particularly appealing to professionals like lawyers, accountants, and consultants, as well
as small businesses that wish to operate under a flexible framework without the need for complex
corporate governance. One of the key benefits of an LLP is that it allows for a more informal structure
in terms of day-to-day management, while still benefiting from limited liability. Additionally, an LLP
does not require a minimum capital contribution, making it a more affordable and easier option for
entrepreneurs compared to a private company. LLPs are also exempt from the rigid compliance and audit
requirements that apply to Private Limited Companies, making them an attractive choice for startups and
small businesses that want to maintain low operational costs. The LLP is also easier to manage since the
partners can choose the level of participation in the business operations, and it allows for tax
transparency where the profits are taxed at the partner level, avoiding the double taxation that can
affect corporations.