ACCA LW ^Eng Syllabus D. The Formation And Constitution Of Business Organisations - Demonstrate A Knowledge Of The Legislation Governing The Partnership, Both Unlimited And Limited - Notes ^{1 / 5}

'the relationship that subsists between persons carrying on a business in common with a view to profit'

This means that a partnership is not a separate legal entity and

Each partner has full personal liability for the partnership debts (liabilities)

These are now rare

They have the following features

• Governed by Limited Partnership Act 1907

• Partners can limit their liability

• One partner must take on full liability

• The partners with limited liability are in effect sleeping partners

  They cannot manage / bind the company nor withdraw their capital

These are far more common nowadays

They have the following features:

• Register with the Registrar of companies

• Name of the partnership must end in LLP

• Governed by LLP Act 2000

• Annual accounts must be files (and audited where appropriate)

• It is a separate legal entity

• Partners liability limits are stated in the Partnership document

• The individual partners pay their own tax

  The partnership does NOT pay corporation tax