Limited Liability Partnership (LLP) Registration in India

Introduction

At the fast-changing business environment, businessmen are in need of a form of organization that allows a partnership yet has the advantages of limited liability and corporate identity. The Limited Liability Partnership (LLP) model exactly offers that. The LLP structure is a perfect combination of flexibility in operation along with a shield of litigation; an ideal combination which was introduced in India under the Limited Liability Partnership Act, 2008.

The registration of LLP is of great advantage to the professionals, service providers, consultants, small and medium-sized firms, and family-owned businesses. It is assistive in continuity, limits risk, and increases credibility of the vendor, client as well as financial institutions.

What is LLP Registration process?

LLP registration involves the process of starting up a business where by two persons or more join hands to run a venture on a business structure which is in place under the law that protects them against liabilities.

Limited Liability Partnership (LLP) is a type of business, which is a mixture of partnership firm and a limited firm. It is an independent legal person, it can act in perpetuity and it provides limited liability to its partners. LLP operates under the registry of Companies (ROC) under the branch Ministry of Corporate Affairs (MCA).

Why is LLP Registration Required?

• Limited Liability: Liability of the partners is capped at the level of the contribution made by each of them.
• Legal Identity: LLP is characterized by a legal identity independent of the partners.
• Minimum Capital Requirement: Has the freedom to start with any capital.
• Tax benefits: LLPs do not have to pay dividend distribution tax (DDT).
• Perpetual Succession: Business does not stop with change of partners.
• Legal Obligation: It is against the law to operate as an LLP without registration. Those people who would like to enjoy the benefits of the limited liability and work under lawful structure are required by MCA to register LLP. Startup schemes, bank loans and government incentives are also applicable to registered LLPs.

Eligibility Criteria

• The number of Partners must be at least 2 (and there is no maximum).
• One of the designated partner should at least be an Indian resident.
• The partners may be individuals or body corporates (companies, LLPs and the like).
• Indian as well as foreign nationals/Entities may be partners.
• It should be a registered office address of the LLP in India.

Documents Required

For Partners (Indian Citizens):

• PAN Card
• Aadhaar Card or Voter ID/Passport/Driving License
• Passport-size Photograph
• Proof of Address (Bank statement/ utility bill not more than 2 months old)

In the case of Foreign Nationals/ NRIs:

• Passport (notarized/apostilled)
• Notarized/apostilled Address Proof
• Passport-size Photograph

For Registered Office:

• Recent Utility Bill (Electricity/Water/Telephone)
• Rent Agreement (rented)
• No Objection Certificate (NOC) of the owner

Step-by-Step Process

• Step 1: Digital Signature Certificate (DSC) – All partners are required to be equipped with DSC to sign electronic forms.
• Step 2: Director Identification Number (DIN) – To be designated partners they require a DIN by filing eForm DIR-3.
• Step 3: Reservation Name – Get the name clearance by MCA by submitting file RUN-LLP (Reserve Unique Name- LLP).
• Step 4: Filing Incorporation Form – Send and attach the form with the required documents FiLLiP (Form of incorporation of LLP):
  • Partner details
  • An address of registered office
  • Subscriber’s sheet
• Step 5: Filing of LLP agreement – A partnership agreement should also be filed within 30 days of the incorporation of LLP in Form 3, outlining the roles and duties and amounts to be contributed to the capital.
• Step 6: Certificate of Incorporation – When accepted, the Registrar gives the LLP Incorporation Certificate.

Timeline

• DSC Application: 1-2 days
• Name Clearance: 2-3 days
• Incorporation Filing: 3 to 5 days
• LLP Agreement Filing: 2-3 days
• Total Time: 10-15 working days

Note: Timeline can get longer depending on how fast the government processes and the accuracy of the documents.

Charges and Prices

Government Charges:

• Name Reservation (RUN-LLP): Rs 200
• LLP Incorporation (Form FiLLiP): Rs (starts at 500)
• LLP Agreement (Form 3): Rs 50–1000 (according to the capital)

Professional Fees include:

• DSC & DIN for 2 Partners
• Name Filing
• Writing and Registering of LLP Agreement
• MCA End to End filling
• Post-Incorporation Advisory

Basic Package begins at: Rs 6,999 (with the minimum governing fee)

Punishments on Non-Compliance

• The penalty upon late filing of returns: Rs 100/day per form and no maximum limit.
• Strike Off: the LLP may be struck off the MCA register in case of non-filing.
• Prosecution and Fines: If a person defaults repeatedly, the case can slip into prosecution or a fine penalty can be imposed.
• Disqualification of Partners: Failure to comply to standards repeatedly can prohibit directors in forming other businesses.

It is imperative to file Annual Return (Form 11) and Statement of Accounts (Form 8) at the prescribed time to avoid penalties.

Why Choose Us?

• We are a group of chartered accountants, company secretary and legal practitioners that boast of years of experience in establishing companies and LLPs.
• One hundred percent Online Process
• End-to-End Support
• Free Name Check for Business
• Writing of Legal Documents
• Transparent Pricing
• Consecrated Compliance Services

No matter whether you are a freelancer, start up or a professional firm, we simplify your LLP registration free of jargon and inconvenience.