What is a limited liability partnership (LLP)?

A limited liability partnership (LLP) is indeed characterized by its structure that limits the liability of its partners while allowing for flexible management of the partnership. In an LLP, partners typically enjoy protections against personal liability for the debts and obligations of the partnership, meaning that they are not personally responsible for the partnership’s debts beyond their investment in the LLP. This provides an advantage over a general partnership, where partners have unlimited personal liability.

Additionally, an LLP retains the flexibility of management similar to a general partnership, allowing partners to participate directly in the management of the business without risking their personal assets beyond their agreed contributions. This balance of liability protection and managerial control is a key defining feature of an LLP, making it an attractive option for many professionals such as lawyers and accountants.