Limited Liability Partnership (LLP) Registration Online in India

An LLP (Limited Liability Partnership) in India is a business structure that combines the flexibility of a partnership with the advantage of limited liability for its partners.

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Four Steps to Get Your LLP Registration

Fill the Form

Provide business details

Add to cart

Pay the required fee online

Submit Documents

Upload required papers

Certificate delivery

Official Document Delivery

Find the best plan for your needs

Basic Plan

8,999
+GST

Standard Plan

13,499
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22,999
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Note: Government fees for incorporation are additional and vary by state. T&C

Overview of LLP

A Limited Liability Partnership (LLP) in India is a hybrid business structure introduced by the Limited Liability Partnership Act, 2008, combining the benefits of both partnership and company forms of business. It offers limited liability protection to its partners, meaning their personal assets are not at risk for the debts of the LLP, while allowing operational flexibility through a partnership-like management structure.

LLPs are particularly suitable for small and medium-sized enterprises and professional services firms, as they provide a simpler and more flexible regulatory framework compared to a private limited company. LLPs require at least two partners, with no upper limit on the number of partners, and must file annual returns and financial statements with the Registrar of Companies.

llp
llp mobile
llp

A Limited Liability Partnership (LLP) in India is a hybrid business structure introduced by the Limited Liability Partnership Act, 2008, combining the benefits of both partnership and company forms of business. It offers limited liability protection to its partners, meaning their personal assets are not at risk for the debts of the LLP, while allowing operational flexibility through a partnership-like management structure.

LLPs are particularly suitable for small and medium-sized enterprises and professional services firms, as they provide a simpler and more flexible regulatory framework compared to a private limited company. LLPs require at least two partners, with no upper limit on the number of partners, and must file annual returns and financial statements with the Registrar of Companies.

Advantages
Disadvantages

Advantages & Disadvantages

Advantages of Limited Liability Partnership (LLP)

Simplicity in Formation

It is relatively easy to form a LLP, since the process is simpler as compared to Company formation and involves lesser formalities and expenses.

Easy Transferable Ownership

It is easy to become a partner or leave the LLP. It is easier to transfer the ownership in accordance with the terms of the LLP Agreement.

Taxation

Another major benefit of incorporation is the taxation of a LLP. LLPs are not subject to Dividend Distribution Tax unlike companies, thus, there will not be any tax on distribution of profit to the partners.

Perpetual Succession

An incorporated Limited Liability Partnership (LLP) enjoys perpetual succession, meaning it remains unchanged regardless of changes in its partners. It retains its rights and properties and continues to exist until legally dissolved.

Fund-Raising

Financing a small business like a sole proprietorship or partnership can be difficult at times. A LLP, being a regulated entity like a company, can attract finance from banks/financial institutions, etc.

Liability

An LLP is a separate legal entity, distinct from its owners. All liabilities, including debts and legal actions, are borne by the LLP and not the individual owners, providing an extra layer of protection for businesses at risk of litigation.

Advantages & Disadvantages

Disadvantages of Limited Liability Partnership (LLP)

Binding Actions

Actions taken by any partner can obligate the entire LLP, potentially leading to unintended legal or financial consequences.

Extended Liability

In certain situations, the partners’ personal assets might be at risk if the LLP’s liabilities exceed its resources.

Capital Limitations

LLPs cannot issue shares or raise funds from the general public, which may limit expansion opportunities.

Complex Dissolution Process

Unlike simple partnerships, dissolving an LLP involves a more complex and time-consuming legal process.

Frequent Documentation Updates

Any changes in the LLP’s structure, like addresses or partnership terms, require updates to the original agreement.

Privacy Concerns

LLPs must disclose financial statements publicly as per legal requirements, reducing privacy.

Who Can Be a Partner in a LLP?

Under the LLP Act 2008 and its rules, partners in an LLP can include:

Who Can Be a Partner in a LLP_ mobile
Who Can Be a Partner in a LLP_

Note: Traditional partnership firm cannot become a partner in an LLP because it is not considered a separate legal entity.

Differences Between

In an LLP (Limited Liability Partnership) in India, there are two main types of partners: “Designated Partners” and “Partners“. Here are the key differences between them

Comparing LLPs with Traditional Partnerships

FeatureLLP (Limited Liability Partnership)Traditional Partnership
Legal EntitySeparate legal entityNot a separate legal entity
LiabilityLimited liability to the extent of their contributionUnlimited liability; partners are personally liable
RegistrationMandatory to register with the Registrar of CompaniesRegistration is not mandatory
Governing LawGoverned by LLP Act, 2008Governed by the Partnership Act, 1932
Number of PartnersMinimum 2, no maximum limitMinimum 2, maximum limit is 20 (10 in banking)
Perpetual SuccessionYes, continues irrespective of changes in partnersNo, partnership dissolves with the change in partners
ManagementManaged as per LLP agreementManaged as per partnership deed
Transfer of InterestCan be transferred as per agreementCannot be transferred without consent of all partners
Annual ComplianceHigher, required to file annual statements and returnsLower, less stringent filing requirements
TaxationTaxed as a partnership but not subject to Dividend Distribution TaxTaxed as a partnership; profits taxed in partners' hands
Foreign InvestmentAllowed subject to FDI guidelinesNot allowed
FlexibilityMore flexible in internal management and profit-sharingLess flexible; governed by the Partnership Act
Audit RequirementRequired if turnover exceeds Rs. 40 lakhs or contribution exceeds Rs. 25 lakhsRequired as per Income Tax Act if turnover exceeds specified limits
DissolutionCan be dissolved voluntarily or by the order of NCLTDissolution based on mutual agreement, death, or insolvency of partners

Minimum Requirements

As Per LLP Act, 2008, there are Minimum Requirements that need to be met For LLP Incorporation in India.

Minimum 2 Designated Partners

Unique bussiness Name

At least one partner must be a resident of India

Registered office address

Documents for LLP Incorporation

The following documents need to be scanned and attached for LLP Incorporation

Identity & Address of Partners

Registered Premises Documentation

Identity & Address of Directors

Scanned Copy of PAN & Aadhaar/Driving License/Passport/Voters ID

Copy of Recent Utility Bills or Bank Statement (Not Older Than 2 Months)

Digital Passport-Size Photo

Email ID & Phone Number

Registered Premises Documentation

Copy of Recent Utility Bills (Not Older Than Two Months)

Scanned Notarized Rental Agreement (English Version)

Scanned No-Objection Certificate from Property Owner

Scanned Copy of Sale/Property Deed in English (For Owned Property)

Scanned Copy of PAN & Aadhaar/Driving License/Passport/Voters ID

Copy of Recent Utility Bills (Not Older Than Two Months)

Copy of Recent Utility Bills or Bank Statement (Not Older Than 2 Months)

Scanned Notarized Rental Agreement (English Version)

Digital Passport-Size Photo

Scanned No-Objection Certificate from Property Owner

Email ID & Phone Number

Scanned Copy of Sale/Property Deed in English (For Owned Property)

Note: The registered office for your business can be a residential address; it does not need to be a commercial space.

LLP Incorporation Procedure

Incorporating a Limited Liability Partnership (LLP) in India involves a series of steps

LLP Incorporation Procedure mobile

Decide Proposed Names: Applicants must select potential names for the LLP prior to the reservation process.

Check Name Availability: Use the Ministry of Corporate Affairs (MCA) portal to ensure the chosen names are not already in use.

Apply for Name Reservation: Through the MCA portal, submit a name reservation request using PART-A of the SPICe form. If the first choice is unavailable, consider alternatives.

Processing Time: The Central Registration Centre usually takes 1 to 3 working days to respond to your name reservation request.

Outcome and Validity: If the name is approved, it is reserved for 90 days, during which you should proceed with the incorporation process. If not approved, adjust based on feedback and resubmit.

Requirement: All designated partners must obtain a Digital Signature Certificate. This is a crucial step as DSCs are needed for electronically filing the incorporation documents.

Application: Apply for the DSCs through certified authorities that issue these certificates, ensuring that each designated partner has one for the upcoming steps.

 

Director Identification Number (DIN): Acquire DIN for all designated partners or those intending to be designated by filling out Form DIR-3.

Fill Out the FiLLiP Form: This form includes applications for DINs, details about the business location, activities, partner contributions, and necessary declarations.

Digital Signatures and Professional Verification: All designated partners must digitally sign the FiLLiP form, which must also be signed by a professional (CA, CMA, CS, or Advocate) for verification.

Online Submission and Review: Submit the incorporation documents via the MCA portal. Ensure all forms are accurate and complete before payment of the requisite government fees and stamp duty.

Examination by ROC: The Registration of Companies (ROC) will review the submission and may request clarifications. Address these promptly if required.

Receiving COI: Once the MCA approves the incorporation documents and no further clarifications are needed, a Certificate of Incorporation is issued. This document is proof of the legal formation of the LLP.

Post-Incorporation Requirements: Following the issuance of the COI, the LLP must apply for a Permanent Account Number (PAN), a Tax Deduction and Collection Account Number (TAN), and open a bank account under the LLP’s name to commence operations.

 

Incorporation of a private limited company within 7-14 working days.

Incorporation of a private limited company within 7-14 working days.

Documents Received After LLP Formation

Incorporation Certificate                                                               
Permanent Account Number (PAN) of the company         
Tax Deduction Account Number (TAN) of the Company 
Articles Of Association (AOA)                                                     
Memorandum Of Association (MOA)                                       
Direction Identification Number (DIN)                                     
Digital Signature Certificate (DSC)                                           
Company Master Data                                                                   

Post Incorporation Compliances

Compliances for a Limited Liability Partnership (LLP) in India as required by the Ministry of Corporate Affairs (MCA), the LLP Act 2008, and other applicable laws

How V Smart Auditor can help ?

Our expert team at V Smart Auditors is committed to making your One Person Company incorporation process as seamless as possible. Here’s what you can expect when you choose us as your partner:

  • Expert Consultation and Planning

    V Smart Auditor Private Limited provides specialized consultation to help you understand the nuances of LLP incorporation. Their team of experts assists in strategizing the incorporation process, ensuring that it aligns with your business objectives and legal requirements.

  • Handling Documentation and Filing

    They take charge of preparing and filing all necessary documentation required for LLP registration. This includes drafting the LLP agreement, filling out forms, and ensuring that all paperwork is accurately completed and submitted.

  • Digital Signature and DIN Assistance

    V Smart Auditor assists in obtaining Digital Signature Certificates (DSC) and Director Identification Numbers (DIN) for the designated partners, which are crucial for the digital filing of documents.

  • Name Approval and LLP Incorporation Process

    They facilitate the process of name approval for your LLP by filing the necessary application and follow through with the incorporation process, ensuring compliance with all regulatory requirements.

  • Post-Incorporation Compliance Guidance

    After the LLP is incorporated, V Smart Auditor provides guidance on post-incorporation compliances such as filing of the initial LLP agreement, registration for taxes, and other statutory requirements.

  • Ongoing Support and Advisory

    Beyond the incorporation process, they offer ongoing support and advisory services for operational and regulatory compliances, ensuring that your LLP remains in good legal standing and up-to-date with all necessary filings and requirements.

Frequently Asked Questions

What is a Limited Liability Partnership (LLP)?

A Limited Liability Partnership (LLP) is a type of business structure that combines elements of both a partnership and a corporation. It offers limited liability to its partners, meaning they are not personally responsible for the debts and liabilities of the LLP.

How is an LLP different from a general partnership?

An LLP differs from a general partnership in that the liability of the partners is limited to their investment in the LLP, which means their personal assets are protected from the business's debts.

What is the minimum number of partners required to form an LLP?

In most jurisdictions, an LLP can be formed with a minimum of two partners, but the exact requirements may vary by location.

Can an LLP have a single partner?

In some jurisdictions, LLPs may allow single-member LLPs, but it is generally more common to have at least two partners for an LLP.

How is an LLP taxed?

LLPs are typically not taxed at the entity level. Instead, profits and losses "pass through" to the individual partners, who report and pay taxes on their respective shares of income.

What are the formalities required for registering an LLP?

To register an LLP, partners typically need to file the necessary documents with the appropriate government authorities, pay the required fees, and comply with the specific regulations in their jurisdiction.

What is the advantage of limited liability in an LLP?

Limited liability means that the personal assets of the partners are shielded from business debts and liabilities, reducing the risk to individual partners.

Are there any restrictions on the type of businesses that can form an LLP?

The eligibility to form an LLP may vary by jurisdiction, but generally, LLPs are suitable for a wide range of professional services and small to medium-sized businesses.

Can an LLP have corporate partners?

Yes, in many jurisdictions, LLPs can have both individual and corporate partners, offering flexibility in the partnership structure.

Are there annual compliance requirements for LLPs?

Yes, LLPs are often required to file annual reports, maintain proper accounting records, and meet other compliance obligations as per local regulations.

What is the process for adding or removing partners in an LLP?

The process for adding or removing partners typically involves amending the LLP agreement, notifying government authorities, and updating the partnership's records.

What is an LLP agreement, and is it mandatory?

An LLP agreement is a legal document that outlines the rights, responsibilities, and contributions of each partner. While it may not be mandatory in all jurisdictions, it is strongly recommended to have one to avoid disputes.

How can an LLP dissolve or be liquidated?

LLPs can be dissolved through various methods, such as unanimous agreement of the partners, court order, or based on the terms outlined in the LLP agreement.

Can an LLP convert to another business structure, like a corporation or a general partnership?

Depending on the jurisdiction's laws, an LLP may be able to convert to another business structure, but this process often involves legal formalities and tax considerations.

What is the significance of an LLP's name and branding?

The name of an LLP is crucial, as it must comply with regulations and be unique to avoid confusion with other entities. Branding is important for building the LLP's reputation and recognition in the market