How is LLP different from a partnership firm?

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LLP and Partnership Firm both look alike but are separate and have separate features:

  • Legal base: Limited Liability Partnership is based on “Limited Liability Partnership Act, 2008” and regular partnership is based on “Partnership Act, 1932”.
  • A number of partners: In a Partnership firm, a minimum of two partners and a maximum of fifty partners are allowed and in LLP minimum of two partners and a maximum no limit.
  • Liability: In LLP, partners have limited liability while in a partnership firm, partners have unlimited liability.
  • Transfer of ownership: There is no restriction on joining and leaving the LLP, but in a partnership firm, partners cannot transfer their shares without the permission of other partners.
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