Last updated: February 25th, 2023 2:04 PM
What are the advantages and disadvantages of a private limited company?
A private limited company is a business organization owned and managed by a group of shareholders, with limited liability for its members. The number of shareholders in a Private Limited Company is limited, typically ranging from 2 to 200. The company's shares are not available for public trading and can only be sold or transferred with the existing shareholders' agreement. Entrepreneurs and small business owners often prefer Private Limited Companies because they offer several advantages. However, Private Limited Companies are subject to specific regulatory requirements. This article will examine some advantages and disadvantages of a private limited company.Advantages of a private limited company
A Private Limited Company (PLC) is a famous business structure offering its shareholders several advantages. Some of the advantages of a Private Limited Company include the following:- Limited liability: One of the most significant advantages of a Private Limited Company is that it offers limited liability protection to its shareholders. This means that the shareholders' assets are not at risk in case of any legal or financial liabilities of the company.
- Separate legal entity: A Private Company has its own legal identity, meaning it can own assets, enter into contracts, and sue or be sued in its name.
- Continuity of business:
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