LLP stands for Limited Liability Partnership. It’s a type of business structure that combines elements of partnerships and corporations, offering limited liability to its owners (partners). In an LLP, each partner is not personally liable for the debts and obligations of the business beyond their investment in the partnership.

For example, if an LLP faces financial difficulties and owes money to creditors, the personal assets of individual partners are generally protected. This limited liability feature can be attractive to many professionals and entrepreneurs.

One key tip for those considering forming an LLP is to clearly define each partner’s roles, responsibilities, profit-sharing arrangements, and decision-making processes in a detailed partnership agreement. This document helps prevent misunderstandings and conflicts down the line.

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