What is a limited partnership?
A limited partnership is a variant of an ordinary partnership. The NSW Partnership Act makes provision for limited liability partnership structure whereby the liability of a partner contributing capital can be limited to the amount of financial contribution, provided that the person doesnt take part in the management of the business.
A limited partnership is a fairly simple business form in which there are one or more general partners and one or more limited partners. General partners are generally those involved in day-to-day decision making or operations. Limited partners are not involved in day-to-day operations and are most often just investors. All profits and losses flow through to partners according to their partnership agreement, which should be written. Limited partners have limited exposure to liability. The primary disadvantages are: general partners face unlimited liability for the firm’s debts and legal liabilities, discontinuation of the partnership upon the death of a partner, and the fact that any general partner can commit the partnership (and thus other general partners) to legal obligations.
A limited partnership is a variant of an ordinary partnership. The NSW Partnership Act makes provision for limited liability partnership structures whereby the liability of a partner contributing capital can be limited to the amount of financial contribution, provided that the person doesn’t take part in the management of the business.
