Legal status

Are there other types of partnership arrangements?

There are a number of other partnership arrangements that you may want to consider as a suitable legal structure for your business. These include:

• Limited partnerships - a limited partnership must register its details with Companies House. A limited partnership has at least one partner who is a general partner, that is to say they have management rights and unlimited liability, and at least one limited partner. A limited partner may be an individual or a company; they usually contribute a fixed amount, as capital or property, to the partnership. However, they remain only liable for partnership debts or liabilities up to the amount they have contributed.
• Limited liability partnerships - a limited liability partnership (LLP) has a separate legal identity, the flexibility and tax status of a partnership, but the benefits of limited liability. It must register with Companies House and is treated in a similar manner to a company with regard to any insolvency difficulties. The liability of the partners is limited to their capital contribution - personal assets cannot be seized to settle business debts.