The following table depicts various advantages of forming a Limited Liablity Partnership (LLP) over Private Limited Company.
| Basis | Limited Liablity Partnetship | Private Limited Company |
| Minimum and maximum number of partners/members | Minimum : 2 partners Maximum : No limit | Minimum: 2 members Maximum: 200 members |
| Form of contribution | The contribution may either be in form of cash, tangible, movable or immovable or intangible property or other benefits to the LLP. | The contribution by members shall be in form of share capital only. |
| Registration Cost | Registration cost in comparison to private company is less. | In comparison to LLP registration cost is more |
| Audit | Only LLP having turnover of Rs. 40 lakhs or more or contribution of Rs. 25 lakhs or more is required to get its accounts audited. | Every private limited company irrespective of its turnover or share capital is required to get its accounts audited. |
| Dividend Distribution Tax (DDT) | DDT is not applicable on LLP. | DDT is applicable on private company |
| Loan to Partners or members | Loan to partners is not taxable. | Loan to members is treated as deemed dividend and hence chargeable to tax. |
| Annual Compliances | In comparison to private limited company less annual compliances are required. | In comparison to LLP more |
| Loan to Directors or partners | LLP can advance loan to its partners. | A private company cannot advance loan to its directors due to explicit prohibition for the same under Section 185 of Companies Act, 2013. |
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