Limited liability partnership 

Advantages
- Partners have limited legal liability
- Flexible roles for partners – each partner has the right to manage the LLP and choose
management how they want.
- Relative ease of formation
- Legal independence

Disadvantages
- Not much privacy - public disclosure – financial accounts have to be submitted to
CH.
- Profit cannot be retain in the same way as a company limited by shares – all earned
profit is distributed
- LLP must have at least two members and if one leaves partnership LLP might have to
dissolve.

Private limited company

Advantages
- Tax efficiency – lower corporation tax on profits
- Limited liability to business owner – financial security
- Separate legal entity – director will have no attachment to company’s actions apart
from their share
- Professional status – easier to get loans from bank as seen as a secure business.
- Company pension

Disadvantages
- Complicated to set up – register with CH and pay a fee
- Complex accounts – may need help from accountants which incurs costs.
- Ownership – will have shareholders who can say how business is run.
- Public records, limited privacy – CH has access to company accounts and records.