Limited Liability Partnership (LLP) Registration

Limited liability partnership (LLP) was launched after January 2009, in India, making it a success with startups and professional services. LLP was launched as a form of business that’s easy to maintain and also supports owners by giving them limited liability.

Benefits of LLP registration

The most crucial reason to register for LLP is the ‘limited liability. In LLP registration, the members of the firm will only be liable for a small amount of debt incurred, which, when compared to proprietorship and partnership, the personal assets of directors and partners are not protected, if the business becomes bankrupt.

Separate Legal Entity

LLP is a separate legal entity from the partners. Each partner can sue the other, if any situation arises

Flexible Agreement

Transferring LLP is a simple process. A person can easily be inducted as the designated partner and the ownership can be switched to them.

Suitable for Small Business

Capital investment for LLP is less than 25lacs and if a turnover is less than 40lacs, there is no requirement for any audit. LLP registration is beneficial for small businesses and startups.

Documents required for LLP Registration

To be submitted by Partners

  • Scanned copy of PAN Card or Passport (Foreign Nationals & NRI’s)
  • Scanned copy of Aadhaar Copy/ Voters ID/ Driving License/ Passport
  • Scanned copy of latest bank statement/telephone bill/ electricity or gas bill
  • Scanned passport size photograph specimen signature

For registered office

  • Scanned copy of latest bank statement
  • Scanned copy of Notarised Rental Agreement in English
  • Scanned copy of NOC from the property owner
  • Scanned copy of Sale deed / Property deed

Frequently Asked Questions

Yes, its cheaper to run an LLP than a private limited company, especially in early start-up days. That’s because, compliances such as audit apply to LLP’s only after the turnover becomes sizeable. Also, the compliance and registration works are much less, when compared to private limited companies.

Normally, startups that don’t look for Venture Capital funding, register LLP’s. It’s because venture capitalists invest only in private and public limited companies.

As per the Act 2008, minimum of two designated partners are required to start an LLP. The designated partners have to fulfill all the requirements of starting and running an LLP.

An agreement made between the partners and the LLP, regarding the relationship between the individual partners in the LLP. The agreement usually consists of management policies, the inclusion of new partners, policy-making strategies, and so on.

Any group of persons who are interested in investing money in a business can start an LLP. A person or an investor becomes a partner of the LLP agreement, as per the Act of 2008.

Yes, non-resident Indians and foreign nationals, willing to enter into an LLP partnership, can do so, provided, all the mandatory documents are submitted, after getting it notarized by the concerned authorities. But, at least one of the partners in the designated partners in the LLP should be an Indian national.

Any individual, company or LLP can become a partner. But, only an individual can become a ‘designated partner’ in an LLP.

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