The benefits of a partnership and a limited liability corporation are combined in a Limited Liability Partnership (LLP). It began to take shape in India in January 2009, and it quickly became a hit with entrepreneurs and professional services. The Limited Responsibility Partnership (LLP) purpose was to create a simple company structure that would benefit owners by limiting their liability. Affordable Online Limited Liability Partnership (LLP) Registration Services in India.
What is Limited Liability Partnership (LLP) Registration?
Limited Liability Partnership Registration: Limited Liability Partnership (LLP) was first introduced in the Limited Liability Partnership Act of 2008. After its introduction, this was quite popular which brings the best from both of world of the limited company and partnership firm.
LLP is an alternative corporate business form that gives the benefits of limited liability of a company and the flexibility of a partnership. The LLP is a separate legal entity, is liable to the full extent of its assets but the liability of the partners is limited to their agreed contribution in the LLP.
Registering an LLP is quite easy and fast. The compliances are simple and cost-effective and popular amongst micro, small & medium enterprises. SattvaCFO can pitch in to provide a superior experience in the registration process.
Limited Liability Partnership (LLP) Name Selection Process
The following process should be ensured while selecting the name of your Limited Liability Partnership (LLP)
- The name of the entity should end with LLP thereby suggesting the same is an LLP to the outside world;
- The name should be unique and there is no existing entity with the same name
- The name should not be offensive to any section of the society
- The name should not reflect any resemblance to a Central / State Government entity
- There should be any registered trademark in the same name
Check Limited Liability Partnership (LLP) Name availability
We support customers to select a Limited Liability Partnership (LLP) Name based on availability and the entire is process is hassle-free and easy to complete
Reasons for choosing Limited Liability Partnership (LLP) structure
The main reason for choosing a Limited Liability Partnership (LLP) is the limited liability. It means the liability of the designated partner is limited to the extent of contribution in the Limited Liability Partnership (LLP)
- Separate Legal Structure
Limited Liability Partnership (LLP) is a separate legal entity vis a vis its partner. A designated partner may be admitted or retired from the entity but the Limited Liability Partnership (LLP) would continue functioning.
- Flexibility
Limited Liability Partnership (LLP) Agreement forms basic written documents ensuring the smooth functioning of the firm. Modification of ownership is permissible via simple documentation in this regard
- Cost-Effective
The cost of managing a Limited Liability Partnership (LLP) is less than of a Limited Company. The filing fess charged by MCA is less than a limited company
- Less onerous Compliance
The annual compliances of Limited Liability Partnership (LLP) is far lesser than a limited company. This makes is ideal for the Micro, Small, and Medium Enterprises (MSME) sector to incorporate their business in corporate format under this structure. Want to know more about Limited Liability Partnership Compliances.
- No compulsory Statutory Audit
Unlike limited companies where annual statutory audit is compulsory, Limited Liability Partnership (LLP) regulation does not set forth any such conditions. While the audit may be required under a different statutes like Income Tax, GST, etc depending on the threshold limit of those statutes. Affordable Online Limited Liability Partnership (LLP) Registration Services in India.
- No Dividend Distribution Tax (DDT)
No DDT is charged on LLP and hence partner can withdraw their profit from LLP subject to guidance as mentioned in the LLP agreement.
Limited Liability Partnership (LLP) Registration Process
The following are processes of Limited Liability Partnership (LLP) registration in India
- Collate documents of Partners
- Fill up accurate and correct information relating to LLP
- Obtain Digital Signature Certificate (DSC) and DIN of Partners
- Complete all legal documentations
- Apply for name reservation (RUN – Reserve Unique Name)
- Verification of documents, preparation of declaration, and details about Partners
- Submit all requisite documents/e-Form with MCA
- Allotment of Certificate of Incorporation from MCA
- Drafting of LLP Agreement
- Submission of LLP Agreement to ROC
- Step 1 : Obtaining DSC & DPIN of Designated Partners
The designated partners have to obtain Digital Signature Certificate (DSC). This is required for the online filing of documents with MCA. Further, every designated partner has to obtain a unique Designated Partner Identification Number (DPIN)
- Step 2 : Applying for approval of LLP Firm Name
Every Limited Liability Partnership (LLP) has to have a unique name. The unique has to be searched at MCA portal and the same should not have been allotted to any existing LLP.
The Registrar approves an LLP name if the naming convention guideline is followed and there are no existing entities with the same name
- Step 3 : Documents submission for Limited Liability Partnership (LLP) Registration
Limited Liability Partnership (LLP) has to submit requisite documents for approval of a certificate of incorporation relating to designated partner’s consent and current status of interests in other corporate entity.
- Step 4 : LLP Certificate of Incorporation
Registrar under Ministry of Corporate Affairs (MCA) allots Certificate of Incorporation duly mentioned LLP Identification Number, Name of LLP, Date of Incorporation of Limited Liability Partnership (LLP)
- Step 5 : LLP Agreement
LLP Agreement is a written document duly mentioning the rights, responsibilities, and liabilities of the designated partner. It defines the guardrail within which the functioning and day-to-day operation of the Limited Liability Partnership (LLP) needs to carry out.
- Step 6 : Obtaining PAN and TAN number
After allotment of certificate of incorporation, the entity needs to apply for Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN) with NSDL.
- Step 7 : Opening of Bank account
Once the above documents are completed, the next step would be opening of bank account, so that the entire operational transaction can be conducted in a smooth manner.
Documents Required for LLP Registration
TO BE SUBMITTED BY PARTNERS
- Scanned copy of PAN Card or Passport (Foreign Nationals & NRIs)
- Scanned copy of Voter’s ID/Passport/Driver’s License
- Scanned copy of Latest Bank Statement/Telephone /Electricity or Gas Bill
- Scanned passport-sized photograph
- Specimen signature (blank document with signature [partners only])
FOR THE REGISTERED OFFICE
- Scanned copy of Latest Bank Statement/Telephone/ Electricity or Gas Bill
- Scanned copy of Notarised Rental Agreement in English
- Scanned copy of No-objection Certificate from the property owner
- Scanned copy of Sale Deed/Property Deed in English (in case of owned property)
Minimum Requirements For LLP Registration
- Minimum 2 Designated partners are required.
- A partnership agreement must be drafted and registered with MCA after successful LLP registration
- No minimum capital requirement.
Advantage of LLP Registration
There are numerous reasons why people choose to form an LLP in India rather than a private limited company. LLPs are seen to be a more straightforward and adaptable company structure. Entrepreneurs feel it possible to start their business since day-to-day operations are very simple. Affordable Online Limited Liability Partnership (LLP) Registration Services in India.
Foreign-Ownership of LLP
Following revisions to the FDI rule on November 10th, 2015, 100 percent FDI is now allowed through the automatic method. There are no FDI-linked performance criteria, and 100 percent FDI is authorized in industries and activities where 100 percent FDI is allowed. As a result, foreign nationals can now establish or invest in a limited liability partnership (LLP).
Before 2015, government clearance was necessary for NRIs and foreign citizens to engage in LLP. As a result, the procedure of forming an LLP for NRIs and foreign nationals was time-consuming and costly. As a result, NRIs and foreign nationals preferred LLP registrations to company registrations.
Why prefer LLP over Partnership?
The major goal of LLP’s introduction in India is to create a type of business that limits the owners’ liability and is relatively straightforward to operate and hassle-free. It’s a different type of company than a partnership.
In an LLP, the partners are not personally liable to creditors. As a result, the partners are only responsible to the extent of their LLP contributions. In a partnership business, on the other hand, the partners are personally liable to the creditors. As a result, entrepreneurs may claim that they are not partners in the partnership business. The partners in an LLP have little liability protection.
Why is an LLP different from a Private Limited Company?
Because both a Private Limited Company and an LLP provide similar benefits, entrepreneurs establishing a new firm are usually inquisitive about the differences. Because LLPs were created to address the needs of small enterprises, the LLP incorporation charge is significantly lower than that of a Private Limited Company. In comparison to Private Limited Company Registration, LLP registration requires fewer papers to be printed on Non-Judicial Stamp paper. Affordable Online Limited Liability Partnership (LLP) Registration Services in India.
FAQ’s on LLP Registration
How many people are required to incorporate an LLP?
A Limited Liability Partnership (LLP) must have at least two partners but can have any number.
How to be a partner in an LLP?
A natural person above the age of 18 must be the designated Partner. The LLP Act of 2018 enables a foreign citizen, including a foreign company, to form an LLP in India if at least one of the chosen partners is an Indian national.
How much Capital is required to start a Limited Liability Partnership?
A limited liability partnership (LLP) can be formed with any amount of money; there is no such restriction. A partner can contribute both actual and intangible assets.
What is Digital Signatures Certificate?
A DSC is useful for electronically identifying the sender or signee. All approved partners must apply using Digital Signatures, according to the Ministry of Corporate Affairs All approved partners must apply using Digital Signatures, according to the Ministry of Corporate Affairs (MCA).
What is DPIN?
An LLP’s Designated Partner Identification Number is a unique number issued to all current and prospective Designated Partners. A DPIN is required for all current or potential Directors.
How long it takes to incorporate an LLP?
The length of time it takes to incorporate is determined by the client’s submission of required papers and government approvals. In 14-20 days,
Can NRIs/ foreign nationals be designated partners in an LLP?
If an NRI holds a Designated Partner Identification Number, he can be a designated partner in a Limited Liability Partnership. However, the LLP must have at least one Designated Partner who is a resident of India.
Do LLPs allow Foreign Direct Investment (FDI)?
The Foreign Investments Promotion Board (FIPB) allows FDI into an LLP via an automated process.
Can we convert a Partnership Firm into an LLP?
An LLP can be formed from an existing partnership firm or an unlisted corporation. There are several advantages to converting to an LLP.
What documents are required for Incorporating an LLP?
Partners’ Interests
- PAN (Personal Identification Number) or Passport
- Any evidence of identity
- Bank account statements
Proof of a registered office
- A letter of authorization from the landlord to use the registered office’s space
- Any utility invoices from the property that is older than two months.
Is LLP a good idea?
A limited liability partnership (LLP) is a hybrid of a partnership and a limited liability company that combines the benefits of both.
What are the Compliances for LLP?
An LLP is required to file tax returns.
- Annual return of a limited liability partnership (LLP) filed on Form 11.
- Financial Statements and Solvency.
- Individual Income Tax Return.
Is it possible for an LLP to raise funds?
An LLP is unable to raise cash from the general public in any way. Only partners can contribute Capital to an LLP, and the partners’ liability is limited to the amount of their contribution.
What is LLP Registration?
LLP Registration is the formation of a legal body that combines the benefits of a corporation and the flexibility of a partnership company into a single entity.
Which is better, the LLP or Private Limited company?
Although both provide the same benefits, forming an LLP over a Private Limited Company is usually preferable. Incorporating an LLP is less expensive than forming a Private Limited Company. Similarly, the LLP’s owner has both ownership and management over the business. In comparison to a Private Limited Company, the LLP has fewer compliances.
How many people are required to form an LLP?
An LLP must have at least two partners to be formed. Affordable Online Limited Liability Partnership (LLP) Registration Services in India.
What is the eligibility of designated partners/partners in an LLP?
A partner might be an individual, a corporation, or an LLP. In an LLP, however, only one person can be a “designated partner.”
What is an LLP agreement?
An LLP agreement between the partners and the LLP controls the relationship between the individual partners in the LLP. An LLP agreement often includes management regulations, including new partners, policy-making processes, and other issues.
What kind of start-ups commonly register LLPs?
LLPs are typically used by start-ups that are not seeking venture capital investment. Because venture capitalists only invest in private and public limited firms, this is the case.
Is it less expensive to run an LLP than a private limited company?
Yes, an LLP is significantly less expensive to manage than a private limited company, especially in the early stages of your business. This is because many regulations, such as audits, only apply to LLPs when they have significant revenue. Most LLPs spend roughly half as much on registrations and compliance as a private limited company in its first year.
Is the process of LLP Registration with SattvaCFO online?
Yes, the process is online, and you can get it done through our consultants, who will guide you through the process.
How can SattvaCFO help in LLP Registration in India?
SattvaCFO has years of experience in LLP registration. SattvaCFO is known for all services related to LLP and more. Hence we’re at your concern, ready to get you sorted through the tough and thick and enhance your ease at getting the job done. Our package includes everything you’ll need to form an LLP and get it up and running. Our specialists are knowledgeable about the regulations and have assisted firms just like yours in forming an LLP.
All you need to do is call us or email us for hassle-free LLP registration in India. Affordable Online Limited Liability Partnership (LLP) Registration Services in India.
