Limited liability partnership

A limited liability partnership (LLP) is kind of like a group of friends who start a club together. But instead of just having fun together, they also work together to run a business. And the big difference between an LLP and just a regular group of friends running a business is that an LLP gives each friend something called "limited liability."

Now, "limited liability" might sound like a big, grown-up word, but it's actually pretty simple. It just means that each friend is responsible for their own actions and debts in the business. So, let's say one friend accidentally does something that causes the business to lose money. Because they're part of the LLP, they'll only be responsible for their share of the debt, not the whole thing. This protects each friend from being held responsible for more than their fair share of the business's troubles.

Think of it like playing with toys together. If one friend accidentally breaks a toy, they're only responsible for fixing or replacing that toy. They're not responsible for fixing or replacing all the toys that everyone else brought to play with. That's kind of how limited liability works in an LLP.

So, to sum it up: limited liability partnership is like a group of friends who start a business together, but each friend is only responsible for their own actions and debts in the business.