Limited Liability Partnership

A Limited Liability Partnership (LLP) is a business structure that combines the flexibility and tax benefits of a partnership with the limited liability protection of a corporation. In an LLP, partners are not personally liable for the debts and obligations of the business, meaning their personal assets are protected in case of business liabilities. This structure is often favored by professional services firms like law firms, accounting firms, and consulting businesses. Additionally, LLPs typically have fewer regulatory requirements compared to corporations, making them an attractive option for small to medium-sized businesses looking for liability protection and operational flexibility.

LLP Registration in India -

Limited Liability Partnership is the full version of the acronym LLP. LLP is a modern business structure in India that combines the limited liability characteristics of a private limited company with the flexibility of a partnership firm. The idea of the LLP was established in India in 2008 and is governed by the Limited Liability Partnership Act of 2008.

LLPs have lower maintenance costs and regulatory requirements, making them a popular choice among entrepreneurs. This type of corporate structure is excellent for small to medium-sized enterprises.

It is simple to establish and run a Limited Liability Partnership in India. To register an LLP, a minimum of two partners is necessary, with no higher limit. The LLP Agreement controls your rights and Designated partners. They are directly responsible for ensuring compliance with all requirements outlined in the LLP agreement.

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Limited Liability Partnership - Incorporation Certificate [Sample]

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Benefits of LLP Registration

The following are the advantages of incorporating an LLP in India:

1. Separate legal entity

An LLP is a separate legal entity from its partners. It is a major benefit that is not available for partnership firms.

2. Limited liability

It helps protect the personal assets of the owners with limited liability protection.

3. Lower cost

The cost of registering an LLP is comparatively lower than a private limited company.

4. No minimum capital required

An LLP can be formed with the least amount of capital, as there is no minimum capital requirement for forming an LLP.

5. Minimal compliance

One of the key benefits of registering an LLP is lower compliance requirements. Mandatory criteria for annual compliances of an LLP are on the lower side as when turnover is less than 40 lakhs, an LLP audit is optional.

Documents required for LLP registration

  1. Documents of both the partners and LLP have to be submitted for incorporating a Limited Liability Partnership:

    Documents of partners

    1. ID proof of partners
    2. Address proof of partners
    3. Residence proof of partners
    4. Passport size photograph
    5. Passport (in case of foreign nationals / NRI)

    Documents of LLP

    1. Proof of registered office address
    2. Digital Signature Certificate

Checklist for LLP Registration

The following are the requirements for incorporating an LLP in India:

  1. Minimum two partners
  2. At least one partner should be a resident of India
  3. DSC for all designated partners
  4. DPIN for all designated partners
  5. Unique name of the LLP that is not similar to any existing LLP, company, or trademark.
  6. Capital contribution by the partners of LLP
  7. LLP agreement between the partners
  8. Address proof for the office of LLP
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LLP Registration process

Obtain Digital Signature Certificate

Step 1. Obtain Digital Signature Certificate

The first step of LLP registration in India is applying for the digital signature of all the designated partners of the proposed LLP. The incorporation of LLP is entirely digital; all the documents are filed online and must be digitally signed.

Designated partners whose signatures are to be affixed on the e-forms must obtain Class-3 Digital Signature Certificates from government-recognized certifying agencies.

Application for DPIN

Step 2. Application for DPIN

You have to apply for the “Designated Partner Identification Number (DPIN)” of all the designated partners or those intending to be designated partners of the proposed LLP.

LLP name approval

Step 3. LLP name approval

LLP-RUN (Limited Liability Partnership-Reserve Unique Name) form is filed for reservation of the name of the proposed LLP. While making the name application, it is recommended that the name should not be similar, identical, or phonetically similar to existing LLPs, companies, firms, and trademarks.

You can easily check for name availability using our free LLP name search tool or company name search tool. The system will provide a list of similar or closely resembling names of existing companies or LLPs based on the search criteria.

If it fulfills all the prerequisites, the proposed name of the LLP is approved by the Central Registration Centre of the Ministry of Corporate Affairs, if found in the ordinance.

Incorporation of LLP

Step 4. Incorporation of LLP

The FiLLip form has to be filed for incorporation of Limited Liability Partnership with the Registrar having jurisdiction over the state in which the registered office of the LLP is located. Details which has to be filed in the FiLLip form are:

    • Address of the registered office
    • ROC
    • Business activity code
    • Number of designated partners and partners
    • Personal details of designated partners and partners
    • Contribution of designated partners and partners
    • Certification by a practising professional (CA, CS, CMA)

The Registrar will register the LLP if the documents comply with the LLP Act’s relevant provisions. Post-approval of the FiLLip form, Certificate of Incorporation is issued within 14 days in Form-16 from the Central Registration Centre of MCA under the letterhead of the Government of India.

Filing of LLP agreement

Step 5. Filing of LLP agreement and Partner’s details

LLP Agreement is the most important document of an LLP that governs the mutual rights and duties of the partners; also between the LLP & its partners.

  • LLP agreement must be filed online in Form-3 on the MCA portal
  • Partner’s details must be filed in Form-4 on the MCA portal
  • The LLP agreement has to be drafted and filed under Form-3 within 30 days of the date of incorporation
  • The LLP agreement must be printed on stamp paper

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