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Limited Liability Company Form

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let's spend 60 seconds on limited liability limited liability is the situation where if a business fails the owners of a company will only lose the money they've invested in the shares of the business the shareholders are not liable to settle outstanding business debts with their personal assets this is because companies are Incorporated businesses and this means that in the eyes of the law the company and the owners or shareholders have separate legal identities the shareholders are not seen as the same as the business and as such they benefit from limited liability so limited liability is a vital protection for shareholders it reduces their Financial Risk but it also makes it easier for companies to raise Finance from new share Capital as investors are more likely to invest in a company because they know their personal assets are not at risk

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