Distinction between Partnership and a Limited company

Partnership

• A partnership is the relation which subsist between persons carrying on a business in common with a view of profit.
• It may be general or limited.
• It is an unincorporated association.
• Consists of 2-20 members.
• Liability of members is generally unlimited
• It is a contract of the utmost good faith.
• Property is jointly owned by the partners.
• Every partner is an agent of every other and the firm
• A partnership is a profit motivated concern
• The firm name is registrable under the provisions of the Registration of Business Names Act

Limited company

• This is a body corporate incorporated under the Companies Act and may be public or private.
• All companies are legal entities or incorporated.
• Liability of members is limited by shares or guarantee.
• It has perpetual succession
• Has capacity to sue or be sued.
• Has capacity to contract and own property.
• A private company consists of 2-50 excluding employees who are members.
• A public must have a minimum of 7 members but has no maximum.
• Companies are subject to the doctrine of Ultra vires.
• A company must have directors, at least one for a private company and at least two for a public company.
• All companies are incorporated by registration in accordance with the provisions of the Companies Act.