Explanation
Private limited company (Pvt Ltd): Minimum 2 shareholders, maximum 200. Governed by Companies Act 2013. Has share capital, a board of directors, and mandatory annual compliance (AOC-4, MGT-7, statutory audit). Subject to heavy disclosure requirements. LLP (Limited Liability Partnership): Minimum 2 partners. Governed by LLP Act 2008. No share capital — partners contribute to LLP capital. Lighter compliance (Form 8, Form 11, audit only if turnover > ₹40L). No restriction on maximum partners. Tax rate differs: LLP pays tax at flat 30% + surcharge + cess (similar to firms); company pays 22% (existing) or 15% (new manufacturing) corporate tax. Choose based on: number of members, governance needs, investment/funding plans, and tax efficiency.