

LLP Vs Proprietorship Company
Difference Between LLP and Proprietorship Company
LLP Company
LLP is registered under Rule 24 of the LLP, Rules 2009 in the Ministry of corporate affairs
Limited liability partnership Is the association of individuals and having the limited liability of all the partners agreed upon contribution to the Limited liability partnership
Characteristics of LLP Company
Separate legal entity: Like a company, LLP also has a separate legal entity. So the partners and the Limited liability partnership (LLP) in are distinct from each other. This is like a company where directors are different from the company.
No requirement of minimum capital: In the case of companies there should be a minimum amount of capital brought by the members or owners who want to form it. But to start a Limited liability partnership (LLP) there is no requirement for minimum capital.
The minimum number of members: To start a limited liability partnership at least two members are required initially. However, there is no limit on the maximum number of partners.
No requirement of compulsory statutory audit: All companies, whether private or public, irrespective of their share capital, are required to get their accounts audited. But in the case of a Limited liability partnership (LLP), there is no such mandatory requirement. A limited liability partnership is required to get the audit done only if:
- the contributions of the LLP exceed ₹ 25 lakhs or
- the annual turnover of the LLP exceeds ₹ 40 lakhs
- Tax audit is compulsory in the following case
- The firm turnover limit is -2cr
Whether aggregate of all amounts received including amounts received for sales, turnover, or gross receipts or on a capital account like capital contributions, loans, etc. during the previous year, in cash and non-a/c payee cheque/ DD during the previous year exceeds five percent of the said amount?
Whether the aggregate of all payments made including the amount incurred for expenditure or on capital account such as asset acquisition, repayment of loans, etc., in cash and non-a/c payee cheque/ DD during the previous year does exceed five percent of the said payment
The tax rate in the case of LLP is 30% no new tax on the scheme is available for LLP
PROPRIETORSHIP COMPANY
If you want to start a one-owner business, the simplest and fastest way is through a sole proprietorship. A sole proprietorship begins when you begin conducting business.
PROPRIETORSHIP is not registered in any action it starts from one person without any registration we start proprietorship through GST registration, MSME,
Characteristics of Proprietor Company
- No Separate legal entity: LLP has a separate legal entity like a company. So the partners and the Limited liability partnership (LLP) are distinct from each other. This is like a company where directors are different from the company.
- No requirement of minimum capital: In the case of companies there should be a minimum amount of capital brought by the members or owners who want to form it. But to start a Limited liability partnership (LLP) there is no requirement for minimum capital.
- A minimum number of members: To start a proprietorship at least one member is required initially. However, there is a limit on the maximum number of partners is one.
- No requirement of compulsory statutory audit: All companies, whether private or public, irrespective of their share capital, are required to get their accounts audited. But in the case of proprietorship, there is no such mandatory requirement.
- Tax audit is compulsory in the following case
- The Firm turnover limit is -2cr
- Whether aggregate of all amounts received including amounts received for sales, turnover, or gross receipts or on a capital account like capital contributions, loans, etc. during the previous year, in cash and non-a/c payee cheque/ DD during the previous year exceeds five percent of the said amount?
- Whether the aggregate of all payments made including The amount incurred for expenditure or on capital account such as asset acquisition, repayment of loans, etc. in cash and non-a/c payee cheque/ DD during the previous year does exceed five percent of the said payment
6. The Tax rate in the case of proprietorship is 30% no new tax scheme is available for LLP