Which business structure allows all partners to have limited liability?

In a limited liability partnership (LLP), all partners benefit from limited liability, meaning they are not personally responsible for the debts and liabilities of the business beyond their investment in the partnership. This structure protects personal assets from being at risk due to the actions or debts of the business, providing a safety net for all partners involved.

Each partner in an LLP can participate in the management of the business while still enjoying this liability protection, which is particularly attractive for professional groups such as lawyers, accountants, and doctors who often form partnerships.

In contrast, other structures like the ordinary partnership expose all partners to unlimited liability, where personal assets can be targeted to cover business debts. A limited partnership has both general and limited partners, with only limited partners enjoying limited liability, while general partners remain fully liable. In a corporation, liability is typically limited, but this structure is not a partnership at all; instead, it involves shareholders. Therefore, the limited liability partnership uniquely addresses the question of allowing all partners to share limited liability within a partnership framework.