Limited Liability Partnership

Limited Liability Partnership (LLP) is a hybrid structure which has benefits of a conventional partnership while still limiting the personal liabilities of the partners. Introduced in India by the Limited Liability Partnership Act, 2008 – it is regulated as a contractual agreement between the partners. Since its introduction in 2010, LLPs have become a popular choice. An LLP is one of the easiest types of businesses to incorporate and manage in India. LLPs are preferred by Professional and Service Businesses like Chartered Accountants, Consulting Businesses, Recruiting Firms, etc. LLP is not the right structure for any business that has plans for raising equity funds from Angel Investors, Venture Capitalist or Private Equity Funds. This is because LLPs are not capable of issuing equity shares.

Advantages of Limited Liability Partnership Registration

Separate Legal Entity

An LLP is recognized as a separate legal entity other than its partners. As per the Limited Liability Partnership Act, 2008 - an LLP can contract with other entities, take legal action, own assets and borrow funds in the name of the LLP itself.

Limited Liability

As an LLP can enter into a contractual relationship in its own capacity, it allows the partners to safeguard their personal assets. In case of any unforeseen liabilities, liability of any partner is restricted to their capital contribution as per the LLP agreement.

Operational Flexibility

LLP Contract Agreement clarifies operating structure of an LLP which includes the rights and responsibilities of the partners. This structure helps to protect the interest of partners in case of loss due to an unlawful act by another partner.

Easier Compliance

An LLP does not require a mandatory audit until a certain level of turnover/contribution is reached. LLPs do not have compliances related to board meetings, statutory meetings, etc. unlike other company structures. This makes it more cost effective to maintain.

Pricing

All Inclusive Pricing - No Hidden Fee

Starter

₹7499
6,499*
  • All expenses and Government fee
  • 2 Digital Signatures (DSC)
  • 2 Director Identification Numbers (DIN)
  • 1 Name Approval Application
  • Certificate of Incorporation
  • PAN Number
  • TAN Number
  • LLP Identification Number
  • LLP Deed Drafting
  • DSC and DIN for additional partners at extra cost

Business

₹9999
8,999*
  • Everything in Starter Package, +
  • 1 Additional Name Approval application
  • GST Registration Application
  • MSME Registration
  • Draft of Bank Account Opening Resolution
  • Draft of Employment offer letter
  • Draft of Employment Contract
  • Draft of Website Disclaimer Policy
  • Draft of NDA
  • DSC and DIN for additional partners at extra cost
Bestseller

Premium

₹17999
16,999*
  • Everything in Business Package, +
  • Annual form filing with MCA for 1st year
  • GST return (up to 100 invoices per month) for 12 months
  • ITR filing for 1st year
  • DSC and DIN for additional partners at extra cost

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Documents required to register a Limited Liability Partnership

PAN Card

PAN Card of all Partners. Valid Passport must be provided by Foreign nationals.

Identity Proof

Aadhar card/Passport/Driving License/Voter ID of Partners.

Address Proof

Latest(No Less than 3 months old) Telephone Bill /Electricity Bill/ Bank Account Statement of Partners.

Photograph

Latest Passport size photograph of Partners.

Business Address Proof

Latest Electricity Bill/Telephone Bill of the registered office address.

Rent Agreement

Rent Agreement of the registered office should be provided if any

NOC from Owner

No Objection Certificate to be obtained from the owner(s) of registered office

Attestation by Gazetted Officer

Documents of partner(s) must be attested by a gazetted officer.

4 Easy Steps to Register a Limited Liability Partnership

Step 1: Obtaining Digital Signature​
Digital signature certificate(DSC) must be obtained for the partners of the LLP. Application for DSC would require passport size photos of the applicant, identity proof and address proof.
Step 2: Obtaining Name Approval
Parallel to the DSC application, the application for name reservation for the name you selected is submitted to the MCA. Name approval applications are processed by the MCA in 24-72 hours.
Step 3: Incorporation
On obtaining the name approval and the digital signatures, we would draft all the incorporation documents for the registration of the LLP and sent it to the Partners for signature. All of the Partners must sign the document and send a scanned copy of the signed documents to us.
Step 4: MCA Approval​
The signed incorporation documents are submitted along with the application for the incorporation of LLP to the MCA. The approval from MCA can take anywhere between 2 - 5 working days. Once the approval is obtained, the LLP would be incorporated, and we begin the process of helping you obtain PAN for the LLP. In parallel, we also draft the LLP Partnership Deed. All the partners of the LLP must sign the LLP Partnership Deed on stamp paper, and a scanned copy of the signed copy must be sent to us within 25 days of incorporation. The signed LLP partnership deed is then verified and uploaded on the MCA portal within 30 days of incorporation to complete the LLP registration process.
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How to Create a Company Name

Unique Name

A Unique Name builds the company brand. This should preferably be a coined word.

Business Objective​

The second part of the name should suggest the business activity of the company

Constitution Type​

The name of the registered LLP must be suffixed with LLP or Limited Liability Partnership.

Frequently Asked Questions about Limited Liability Partnership

To incorporate a Limited Liability Partnership, a minimum of two people are required. A Limited Liability Partnership must have a minimum of two Partners and can have a maximum of any number of Partners.

The Designated Partners needs to be over 18 years of age and must be a natural person. There are no limitations in terms of citizenship or residency. Therefore, the LLP Act 2008 allows Foreign Nationals including Foreign Companies & LLPs to incorporate a LLP in India provided at least one designated partner is resident of India.

Yes, a NRI or Foreign National can be a Designated Partner in a Limited Liability Partnership after obtaining Designated Partner Identification Number. However, atleast one Designated Partner in the LLP must be a Resident India.

A Digital Signature establishes the identity of the sender or signee electronically while filing documents through the Internet. The Ministry of Corporate Affairs (MCA) mandates that all Designated Partners apply with a Digital Signature for Designated Partner Identification Number. Hence, a Digital Signature is required for all Designated Partner of a proposed LLP.

Designated Partner Identification Number is a unique identification number assigned to all existing and proposed Designated Partner of a LLP. It is mandatory for all present or proposed Designated Partner to have a Designated Partner Identification Number. Designated Partner Identification Number never expires and a person can have only one Designated Partner Identification Number.

Yes, an existing partnership firm or a company that is unlisted can be converted into LLP. There are many advantages of converting a partnership firm into a LLP; however, the same doesn’t apply for the conversion of a Company to a LLP.

You can start a Limited Liability Partnership with any amount of capital. There is no requirement to show proof of capital invested during the incorporation process. Partner’s contribution may consist of both tangible and/or intangible property and any other benefit to the LLP.

Identity proof and address proof is mandatory for all the proposed Designated Partners of the LLP. PAN Card is mandatory for Indian Nationals. In addition, the landlord of the registered office premises must provide a No Objection Certificate for having the registered office in his/her premises and must submit his/her identity proof and address proof.

An address in India where the registered office of the LLP will be situated is required. The premises can be a commercial / industrial / residential where communication from the MCA will be received.

Once a Limited Liability Partnership is incorporated, it will be active and in-existence as long as the annual compliances are met with regularly. In case, annual compliances are not complied with, the LLP will become dormant and maybe struck off from the register after a period of time.

LLPs are required to file an annual filing with the Registrar each year. However, if the LLP has a turnover of less than Rs.40 lakhs and/or has a capital contribution of less than Rs.25 lakhs, the financial statements do not have to be audited.

Yes, Foreign Direct Investment (FDI) is allowed in LLP under the automatic route in sectors allowed by the Foreign Investments Promotion Board (FIPB). However, Foreign Institutional Investors (Flls) and Foreign Venture Capital Investors (FVCIs) will not be permitted to invest in LLPs. LLPs will also not be permitted to avail External Commercial Borrowings (ECBs).

No, one of the essential requirements for setting LLP is ‘carrying on a lawful business with a view to profit’. Therefore, LLP cannot be incorporated for undertaking “Not-For-Profit” activities.

We can help you incorporate a Limited Liability Partnership in 14-20 days. The time taken for incorporation will depend on submission of relevant documents by the client and speed of Government Approvals. To ensure speedy incorporation, please choose a unique name for your LLP and ensure you have all the required documents prior to starting the incorporation process.

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Comparison Between Various Business Structures

Act

Companies Act, 2013

Companies Act, 2013

Limited Liability Partnership Act, 2008

Indian Partnership Act, 1932

No specified Act

Registration Requirement

Registration under Companies Act is mandatory

Registration under Companies Act is mandatory

Registration under LLP Act is mandatory

Unregistered partnerships are legal, but registered entity enjoys certain advantages

There is no registration criteria prescribed. But, registration is recommended

Number of members

Minimum 2 and not more than 200 shareholders

Only an individual,and an Indian resident can be the shareholder

No bar on maximum number of partners, but minimum 2 Designated Partners are required

It is formed with minimum 2 partners, but not exceeding 50

Proprietor is the only owner of the firm

Separate Legal Entity

Yes. It is a separate entity and can own assets in its name.

Yes. It is a separate entity and can own assets in its name.

Yes. It is a separate entity and can own assets in its name.

No. It does not have any separate identity from its partners 

No.  Proprietor and business are considered the same

Liability Protection

Limited up to the total value of shares subscribed

Limited up to the total value of shares subscribed

Limited up to the capital amount agreed to introduce

Partners are jointly and severally liable to pay the debts of the Partnership Firm

Proprietor’s liability is to pay-off all the debts and obligation of the firm

Statutory Audit

Auditor must be appointed within the 30 days of incorporation

Auditor must be appointed within the 30 days of incorporation

Applicable when turnover exceeds INR 40 Lakh or contribution exceeds INR 25 Lakh

Statutory audit not applicable. Tax audit may be applicable based on turnover

Statutory audit not applicable. Tax audit may be applicable based on turnover

Ownership Transferability

Shares can be transferred with the consent of other Shareholders

Shares are not easily  transferable 

Ownership can be changed with consent of other partners

Ownership is not transferable easily, clause of partnership deed should be referred

Firm is no different from proprietor and so ownership is not transferable

Uninterrupted Existence

Yes. Perpetual existence as the management and owners are different. Ownership is easily transferable

Yes. The nominee will take place of member.

Change in Partners or Designated Partners does not affect the existence of LLP

Change in partner leads to dissolution or formation of another partnership firm

Death or insolvency of proprietor directly affects the firm

Foreign Participation

Foreign national are allowed to invest under the Automatic Route

Member, nominee and director must be an Indian resident

Foreign nationals are allowed, subject to FDI Guidelines

Foreign nationals are not allowed to be a partner

Foreign Nationals cannot commence proprietorship business

Tax Rates

Moderate. Tax rate applicable for small companies is reduced to 22%, dividend distribution tax applicable

Moderate. Tax rate applicable for small companies is reduced to 22%, dividend distribution tax applicable

High. With tax rate of 30% on business profit, no tax on income distribution to partners

High. With tax rate of 30% on business profit, no tax on income distribution to partners

Low. Tax rates of individual applied to Proprietorship Firm

Statutory Compliances

High. Companies have to meet high compliance requirements 

High. Companies have to meet high compliance requirements 

Moderate. Lesser compliance requirements compared to companies

Low. Separate ITR of partnership is filed, else there is no filing requirement

Low. No compliances and no requirement to file a separate ITR