| Sr. No. | Particulars | Company | LLP | Partnership |
|
1 |
Registration | Registration of Company is mandatory under Companies Act, 2013 and the rules made thereunder. | Registration of Limited Liability Partnership is mandatory under Limited Liability Partnership Act, 2008. | Registration of Partnership firm is optional. Though it is always advisable to get the same registered under Indian Partnership Act, 1932. |
| 2 | Time to constitute | Time normally takes 7-10 days depending upon work load at Central Registration Centre under Ministry of Corporate Affairs. | Time normally takes 7-10 days depending upon work load at Central Registration Centre under Ministry of Corporate Affairs. | Registration under Indian Partnership Act, 1932 normally takes 4-5 days. |
|
3 |
Regularized & Compliance Management |
It is regulated under the Companies Act, 2013 and therefore requires compliance under certain provisions like Annual Filing, Board of Directors, Annual General Meeting etc. | It is less regulated than Company. Compliance are still there but not with the same magnitude. It is regulated under Limited Liability Partnership Act, 2008 and had some compliances under certain provisions like Annual Filings & Returns. | It is less regulated than LLP. There are no major regular compliances to be carried out under the Indian Partnership Act, 1932, only event / base |
|
4 |
Distinct Identity & Liability Thereof |
· Company has distinct identity from its members. · As company has distinct identity, company is liable for its act. · Liability of Shareholders is limited to the extent of their shareholding in Company. |
· LLP has distinct identity from its partners. · Same status as Company meaning thereby that partners are limited only up to the amount of their contribution. |
· Partnership does not have distinct identity from its partners. · Partners are liable for business / work performed under Partnership. |
|
5 |
Minimum Paid up Capital Requirement |
Earlier there was a minimum capital required of Rs. 1 lakh in case of Private Limited Company and Rs. 5 Lakh in case of Public Limited Company. Now the same condition has been abolished, now there is no Minimum Capital requirement. |
There is no such requirement to have minimum capital to incorporate limited liability partnership. |
There is no such requirement to have minimum capital to incorporate partnership firm. |
|
6 |
Minimum number of Shareholders / Partners and Maximum |
· Private Limited Company – Minimum 2 members and Maximum 200 Members · Public Limited Company – Minimum 7 members and Maximum there is NO limit |
Minimum 2 partners and Maximum there is NO Limit |
Minimum 2 partners and Maximum No Limit as per partnership act. |
|
7 |
Foreign Direct Investment (FDI) |
Company is eligible to receive FDI in terms of RBI Guidelines and FEMA Provisions. |
LLP is eligible to receive FDI only through approval route. |
Not allowed |
|
8 |
Foreign National as Shareholder / Partner |
Foreign National can become shareholders as FDI is allowed in certain sectors. |
Foreign National can be a partner in LLP. |
Foreign National cannot become partner. |
|
9 |
Initial Public Offer (IPO) |
Public Company can go for IPO. Private Company can convert itself into Public Company and can go for IPO. |
At present, not allowed. |
Not allowed. |
|
10 |
Audit |
Audit of accounting records and financial transactions of the company is compulsory. |
The Audit is required only if the contribution is above Rs.25 lacs or if annual turnover is more than Rs.40 lacs. |
Under Indian Partnership Act, 1932 it is optional |
| 11 | Tax Audit | Audit is applicable in case turnover is one more One Crore. | Audit is applicable in case turnover is one more One Crore | Audit is applicable in case turnover is one more One Crore |
|
13 |
MAT (Minimum Alternate Tax) |
Provisions are applicable. |
No such provisions are applicable |
No such provisions are applicable. |
| 14 | Tax on Distribution of Profits | Earlier it was “Dividend distribution Tax @ 16.99% to be payable by the company. Now in recent budget it is removed. | No Such Provision | No such provision |
