Is it an adequate limited liability association for you?
This page is here to establish the facts about limited liability associations, explaining what they are and set the questions you should ask for if it is the best structure for your business. Nothing on this page or website is designed as legal advice, and we recommend that you seek appropriate professional advice if you have any questions about the best structure for your business.
What is a limited liability association?
A limited liability association combines characteristics of ancient associations and limited liability companies. Like limited liability companies, they offer the protection of limited liability to shareholders. Like traditional associations, they offer a flexible and fiscal structure and government agreements.
Limited Liability Associations (LLP) are very recent, having been introduced until April 6, 2001. LLP were designed for traditional professional associations, such as lawyers, accountants or architects, whose professional bodies had not been incorporated as limited companies.
Benefits of Limited Liability Associations
or unlike a conventional partner partner (also known as members) can limit your personal responsibility for issues such as employee responsibility.
o Limited liability associations allow greater flexibility with voting rights and rights to association assets when the Association ends. This can be especially useful when allowing new or withdrawn partners.
o The fiscal treatment may be advantageous compared to companies.
How to form a limited liability association
An LLP must have the appropriate forms presented with the companies that will be formed, in the same way as a limited company. A certificate of incorporation by the business recorder is issued at the reception of these forms.
As a word of warning, house companies will verify the proposed name before the incorporation to ensure that the name is not used by a company or other LLP. We strongly recommend that you return your completed documentation as soon as possible because companies run on a base of “first, first service”. A delay can mean that you will lose your name to a rival.
The Scripture of the Association
We strongly recommend that you have an agreement to establish the duties, rights and responsibilities of each of the partners and establish how the business day-to-day business will be executed. Legislation has few provisions governing these relationships.
We offer a model association writing that:
o Acts as a formal agreement that establishes the rights and obligations of the partners during the existence of the Association.
o Sets the conditions when the association is dissolved
or gives details of the participation of profits (with a presumption of equal gain conditions)
o Allows monthly salaries to pay in advance the profit actions.
or allows you to establish decision-making procedures
Or put on vacation agreements.
o Sets rules for couples of external interest.
How is a limited liability company tax?
Limited liability associations are, mainly, taxes in the same way as traditional associations. The taxi driver “analyzes” the profits of an association and treats them as the personal income of the partners, with each partner that is being evaluated on their share of LLPS income or profits. There are some differences with the traditional association, a loss relief is not unlimited for the limited liability partner.
When a traditional association becomes a limited responsibility, an exemption from seal rights is generally granted in the transfer of ownership of the association provided that all partners in the transfer of association existing to LLP with identical interests.