• There are generally 5 types of business structures you can choose from if you’re starting a new business for profit:
  • Sole-proprietorship
  • General Partnership
  • Limited Partnership (LP)
  • Limited Liability Partnership (LLP)
  • Limited Liability Company (LLC)
• To decide which business structure is most suitable for you, you will need to consider the following factors: –
  • How much capital you are prepared to invest?
  • How many owners there will be in the business?
  • What liabilities and responsibilities you are prepared to assume?
  • What risks you are prepared to take?
  • Whether a company of that structure will be easy to close?
• Some of the main features of a Limited Liability Partnership include the following: –
  • Limited Liability Partnership (LLP):
    • An LLP gives its owners the flexibility of operating as a partnership while having a separate legal identity like a private limited company. This means that the partners of the LLP will not be held personally liable for any business debts incurred by the entity.
    • It also provides its partners with limited personal liability. This means that a partner will not be held personally responsible for the losses that arise from another partner’s mistakes. A partner will only be personally responsible for the losses that arise from his own mistakes and acts.
    • It must have at least 2 partners at all times.
    • The partners’ respective profits and management responsibilities are agreed in advance when the entity is first formed.
    • An LLP is a separate and distinct legal entity. As such, it is entitled to sue and be sued in its own name or own land in its own name.

In addition, it has perpetual succession (i.e. it will not terminate or dissolve upon the death or departure of the owners or partners) and can continue to exist and operate upon the death or departure of the owners without having to transfer property whenever there is a change of its ownership.