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LLP Registration in India

Q: What documents are required for Incorporating an LLP?

For the Partners PAN or Passport Any Identity proof Bank statements Registered office proof NOC from the landlord to use the premises of the registered office Any utility bills of the premises which is not less than two months.

LLP Registration in India has become an alternative form of business that provides the advantages of a Company and the flexibility of a Partnership firm into a single organization. The Concept of LLP in India was introduced back in 2008 by the Limited Liability Partnership Act of 2008. This unique hybrid is suitable for setting small, medium-sized businesses.

It is very easy to manage and incorporate a Limited Liability Partnership in India. To register an LLP minimum of two partners are required, there is no upper limit as such. The LLP agreement states the rights and the duties of the Partners. In an LLP one partner is not responsible for the misconduct and negligence of the other partner. The partners are responsible for the compliances and all the provisions that are specified in the LLP agreement.

Checklist for registering an LLP in India

For incorporating an LLP in India:

1

A minimum of two partners are required.
2

The Digital Signature Certificate is required for all designated partners.
3

DPIN for all designated Partners.
4

The name of the LLP should be such that it is not similar to the name of any existing LLP or Trademark registration.
5

Capital contribution by the Partners of the LLP.
6

LLP Agreement between the Partners.
7

Proof of registered office of the LLP.

How to register your LLP with IndiaFilings?

The whole process to get an LLP registered in India with IndiaFilings is very easy. You need to follow these 10 steps.

1

Once we receive your request an engagement reaches you, explains the whole process, and collects the necessary documents.
2

The documents can be submitted online through our IndiaFilings website or mobile application.
3

The received information is then verified and the process to obtain the Digital Signature Certificate of the applicant begins.
4

Once the DSC is the applicant has to complete the OTP Verification or the video KYC check.
5

A request is filed with the MCA for reserving the name of the LLP.
6

On receiving the documents the incorporation documents are drafted and sent to the partners for signatures.
7

A scanned copy of the documents is to be uploaded on the IndiaFilings platform.
8

The signed documents along with the application are then sent for approval to the MCA which takes around 2-5 working days.
9

We also help in opening a bank account in the name of the LLP, in parallel to this we draft the LLP Partnership deed. This deed is signed by all the partners and on a stamp paper which has to be then uploaded to the IndiaFilings platform within 25 days of Incorporation.
10

The Signed deed is then verified by the engagement manager and uploaded on the MCA Portal within 30 days of incorporation.

Documents required to register an LLP in India

For registering an LLP in India following documents are required. We at IndiaFilings carry on LLP registration with just a nominal fee of Rs.7899.

For the Partners:

PAN card or Passport if the applicant is a foreigner.
Drivers license or Aadhar card, resident card or election card, or any other identity proof issued by the government.
Less than 3-month-old bank statement or telephone bill.

Registered office proof:

The authorization from the landlord ( Name mentioned in the Electricity bill or Gas bills or Property Tax receipt or sale deed) to use the premises as a registered office. This acts as a NOC from the landlord and;
Proof of evidence of any utility services like gas, electricity, telephone depicting the address of the premises bearing the name of the owner or document, which is not old than two month.

Advantages of LLP registration in India

There are several reasons why people opt for LLP registration in India over Private Limited Company incorporation. LLPs are considered to be easier to set up and flexible form of business. Entrepreneurs find it feasible to start their organization as it is comparatively hassle-free in day-to-day operations. Here, we take a look at the various advantages of LLPs.

Low registration cost: The cost of registering an LLP in India is comparatively lower than that of incorporating a public limited company or a private limited company. You can register an LLP here through IndiaFilings at just 7899.

No requirement for minimum contribution: As an LLP can be formed with the least possible capital, there is no minimum capital requirement in the incorporation of an LLP.

No limits on the owners of the business: An LLP requires a minimum of 2 partners but there is no such upper limit on the maximum number of partners. Whereas in a private limited company there are restrictions on having more than 200 members.

No requirement of compulsory audit: Whether the company is Public or Private irrespective of their share capital is expected to get its account audited. But here in the case of LLPs, there is no such mandatory requirement and this is considered to be one of the significant compliance benefits of forming an LLP. A Limited liability company is supposed to get its audit done only in two cases.

When the contribution of LLPs exceeds over Rs. 25 lakhs.

When the annual turnover of LLPs exceeds over Rs. 40 lakhs.

Taxation aspect on LLP: LLP is liable for payment of income tax and the share of the partner is not liable to taxation. Thus, no Dividend Distribution Tax (DDT) is payable. Know more

Why prefer LLP over Partnership?

The main purpose of introducing LLP in India is to introduce a form of business that provides limited liability to the owners and is comparatively easy to manage and hassle-free. It is an alternative to Partnership firms. Here, we take a look at the major differences between an LLP and a partnership firm.

Cost registration

At IndiaFilings LLP registration can be done online at just Rs.7899, whereas Partnership registration can be done at just Rs.5899.

Limited liability

In an LLP the partners are not responsible to the creditors externally. Hence, the partners are liable to the extent of their contribution to the LLP. On the contrary, in the case of a partnership firm the partners are personally responsible to the creditors. Because of this entrepreneurs may deny being partners in the partnership firm. In an LLP the partners enjoy limited liability protection.

The number of partners

LLP and partnership firms both must have a minimum of 2 partners. However, there is no upper limit in the number of partners in an LLP. Just in case if the number of partners reduces below 2 in a partnership firm due for any reason the firm would stand dissolved. Whereas in the case of LLPs if the number of partners reduces below 2, the sole partner can find a new partner without actually dissolving the LLP.

Central vs State Government

An LLP can shift its registered office and open a bank account anywhere in India as it is registered under the Ministry of Corporate Affairs of India.

The Registrar of firms that registers the partnership firms is controlled by the state government. Hence, it is more tedious to operate or move across India with Partnership firms.

Perpetual existence

The subsistence of LLP does not depend on its partners. The partners of the LLP can change from time to time, but that will not affect the existence, continuity, or operations of the LLP.

In the case of a Partnership firm, the resignation or death of any partner would have huge consequences and the Partnership would have to be reconstituted.

Membership

Members can be added to LLP during incorporation or post incorporation. The following persons can be partners in LLP:

Individuals
Limited liability partnership
Companies
Foreign Limited Liability partnership
Foreign Companies
Agreement

The LLP agreement must be executed and filed within 30 days of incorporation of an LLP. If the LLP fails to file the agreement, then there is no agreement and the First Schedule of the LLP Act will administrate the relationship between the Partners and LLP.

In case there is written agreement and no detailed declaration about any of the matters dealt with in the first schedule, such matters will be administered by the first schedule.

What makes an LLP different from a Private Limited Company?

Entrepreneurs starting a new business are always curious to know the difference between a Private Limited Company and an LLP, as both of them offer similar features. Here's the comparison between a Private Limited Company and an LLP from an entrepreneur's perspective for starting a new business.

Registration process: The processes for Private Limited Company registration and LLP Registration are very similar with some differences in the documents and the forms that are filed for incorporation.

Following are the steps involved for the incorporation of a Private Limited Company as well as an LLP.

Obtaining the Digital signature certificates (DSC)for the proposed Directors
Obtaining the Director identification number (DIN) for the proposed Directors
Obtaining the approval of the name from the MCA.
Filing for incorporation.
Both LLP and Private Limited companies are registered with the Ministry of Corporate affairs under Central Government. The processing time for incorporation of both Private and public limited companies takes around 15-20 working days.

Cost of Registration: The LLPs have been designed to meet the needs of small businesses and hence, the incorporation fee for an LLP is comparatively cheaper than that of a Private Limited Company. LLP registration requires a lesser number of documents that need to be printed on Non-Judicial stamp paper as compared to the Private Limited Company Registration. Through IndiaFilings a Private Company can be registered at just Rs.6899 online here.

Features: Similar features are offered by LLP and Private Limited Company. Both being separate legal entities have assets and liabilities that are separate from that of the promoters. Even though both LLP and Private Limited companies are transferrable, a Private Limited Company offers more flexibility when it comes to transferring or even sharing ownerships. Unless closed by the promoters or by a competent authority both Private Limited Company and LLP have a perennial life.

Ownership: In LLP the partners hold the ownership as well as the powers to manage and control the LLP. Therefore, a Partner in LLP will play a very significant role as he will play the role of both owners as well as a manager. In parallel, flexibility is offered to the promoters by a Private Limited Company when it comes to ownership and ownership sharing.

Compliance: For LLP and Private Limited Company the Tax Compliances are similar. LLPs enjoy several advantages when it comes to Compliances relevant to the Ministry of Corporate affairs. An LLP doesn't need to have its account audited if the annual turnover of the LLP is less than Rs. 40 lakh and the capital contribution doesn't exceed Rs. 25 lakh. An LLP would however have to file LLP Form 8 and LLP form 11. On the contrary, a Private Limited Company would have to file an annual return with the Ministry of Corporate Affairs each year.

Foreign Ownership of LLP

Post amendments to FDI regulation on 10th, November 2015, 100% FDI is now permitted the automatic route. 100% FDI is allowed in sectors and activities where 100% FDI is allowed and there are no FDI-linked performance conditions. Hence, foreign nationals can now start or invest in LLP. Click here, to know more about the recent FDI reforms.

Government approval was required before 2015 for investments in LLP by NRIs and foreign nationals. Thus, the process of LLP incorporation by NRIs and foreign nationals was cumbrous and expensive. So, the NRIs and foreign nationals preferred company registrations over LLP. But now, with the relaxation of FDI norms the NRIs and foreign nationals can easily register their LLPs.

Visit Indiafilings.com if you are an NRI or foreign national looking to start an LLP. We offer LLP registration for NRIs and foreign nationals starting from just Rs. 8000.

Post-Incorporation Compliances of LLPs

Along with the incorporation of LLP, we at IndiaFilings help you to maintain the basic accounting and Compliance of your LLP at a very affordable price. The package starts from Rs.7899 per year. Following are the compliances that an LLP must follow every year.

Income tax return: Income tax return using form ITR 5 must be filed by the LLPs. Form ITR 5 can be filed online through the income tax website using the digital signatures of the designated partner.

MCA annual return: The LLP Form 11 should is due on or before the 30th of May each year. Form 11 contains the details of the number of partners, total number of partners, total contribution received by all partners, details of body corporate as partners, and summary of the partners. Along with this Form, 8 must be filed within 30 days from the end of the 6 months of the respective financial year along with some prescribed fees. Hence, LLP form 8 must be filed before the 30th of October of each financial year.

In addition to this, GST registration, GST return filing, and TDS return filing would be required for the LLP based on the sales and turnover.

IndiaFilings is the market leader in LLP registration services in India, also offers a variety of business registration services like Private Company Limited registration, One Person Company registration, Nidhi Company Registration, Section 8 Company Registration, Producer Company registration, and Indian Company registration.

LLP Name Availability

LLP Act does not permit registration of identical or similar names existing Company/LLP name

LLP Bank Account Opening

Open a new or link your existing ICICI bank current account with LEDGERS for seamless bank account reconciliation, account balance check and sending of payments through NEFT / RTGS / IMPS.

Open a new or link your existing DBS bank business account with LEDGERS for seamless bank account reconciliation, account balance check and sending of payments through NEFT / RTGS / IMPS.

Bank Account Opening

Opening a current account for an LLP is easier when compared to opening of current account for a sole proprietorship firm or partnership firm as an LLP is a registered legal entity – recognized by law. Therefore, once a LLP is incorporated, a bank account can be opened in the name of the LLP with the incorporation certificate of the LLP and identity/address proof of the Partners.

How many people are required to incorporate an LLP?

A Limited Liability Partnership must have a minimum of two Partners and an LLP can have any number of Partners.

How to be a partner in an LLP?

The designated Partner must be a natural person who is above 18 years of age. LLP Act 2018 allows a foreign national including Foreign Companies to incorporate an LLP in India, provided at least one designated partner is Indian.

How much Capital is required to start a Limited Liability Partnership?

An LLP can be started with any amount of money there is no such minimum requirement. A partner may contribute both tangible or intangible property.

What is Digital Signatures Certificate?

A DSC is helpful in identifying the sender or the signee electronically. The Ministry of Corporate Affairs (MCA) has made it mandatory for all the designated partners to apply with the Digital Signatures.

What is DPIN?

Designated Partner Identification Number is a unique identification number that is assigned to all existing and proposed Designated Partner of an LLP. All the present or proposed Directors must have a DPIN.

How long it takes to Incorporate an LLP?

The time taken for incorporation depends on the submission of relevant documents by the client as well as the Approvals from the Government authorities. IndiaFilings can help you Incorporate an LLP in 14-20 days.

Can NRIs / foreign nationals be designated partners in an LLP?

An NRI can be a designated partner in a Limited Liability Partnership if he has a Designated Partner Identification Number. However, at least one Designated Partner in the LLP must be a resident Indian.

Do LLPs allow Foreign Direct Investment (FDI)?

FDI is allowed under automated route in an LLP by the Foreign Investments Promotion Board (FIPB).
Note: Foreign Institutional Investors and Foreign Capital Investors are not allowed to invest in LLPs.

Can we convert a Partnership Firm into an LLP?

An existing partnership firm or a Company that is unlisted can be converted into an LLP. This conversion into an LLP brings in many benefits.

What documents are required for Incorporating an LLP?

For the Partners

1. PAN or Passport
2. Any Identity proof
3. Bank statements

Registered office proof

4. NOC from the landlord to use the premises of the registered office
5. Any utility bills of the premises which is not less than two months.

Is LLP a good idea?

LLP is a combination of both Partnerships and a Limited Company, offering the advantages of both the companies.

What are the Compliances for LLP?

An LLP is supposed to file

1. LLP Annual return by Filing Form 11.
2. Final Statement of Account and Solvency
3. Income Tax Return.

Is it possible for an LLP to raise funds?

An LLP cannot raise funds from the public in any form. In an LLP only partners can contribute their capital and the liability of the Partners is limited to the extent of their contribution.

What is LLP Registration?

LLP Registration is the registration of an entity that provides the advantages of a Company and the flexibility of a Partnership firm in a Single organization.

Which is better the LLP or Private Limited Company?

It is always better to incorporate an LLP over a Private Limited Company as though both offer the same features. The cost to incorporate an LLP is less as compared to the Private Limited Company. Similarly, the LLP owner holds the ownership as well as control over the Company. The Compliances in the LLP are fewer as compared to a Private Limited Company.

How to start an LLP?

The process of starting an LLP is completely online. All you need to do is submit the documents online. Regular follow-ups will be done by our consultants. It requires