LLP Registration in India
Limited Liability Partnerships(LLP) is a convenient new model that can be used by a new entrepreneur for starting business. It is advantageous as it gives the benefits of limited liability while allowing the flexibility of a partnership to any businessperson opting for it. Governed by the Limited Liability Partnership Act, 2008, the LLP is a separate entity from its partners. Another good feature of this format is that the partners are not held responsible for the other partners’ misconduct or unauthorized actions.
Easy to form and with partners not liable to pay company debts by using their personal assets it makes good business sense to opt for LLP registration in India. Features of easy transferability of ownership and perpetual succession are other incentives offered by this mode of company registration. New entrepreneurs are increasingly choosing the option to register a LLP in india over other methods of company registration.
The following documentary proof of all the partners as well as the business is required with the application to register a LLP in India.
PAN card of all the partners is required as proof of identity.
Address Proof of Partners
Aadhar card, Passport, Voter Identification card or Driving License can be used as proof of address with the details matching those on the submitted PAN card.
Residence Proof of Partners
Latest bank statement or any utility bill like electricity, water, fixed line/ mobile phone or piped gas bill which is not more than 2 months old can be furnished as residential proof.
Rules for Foreigners/ NRIs
In case of foreigners or NRIs being the partners, it is mandatory to submit a notarised/ apostilled copy of their passport. Such individuals have to provide any of the documents namely- driving license, bank statement, residence card, government issued ID proof- as proof of address.
All partners, whether Indian or otherwise looking to register a LLP in India have to provide passport size photographs.
Registered Office Address
The rent agreement along with a No Objection Certificate (NOC) from the landlord stating explicitly that the premises are rented for the purpose of the company’s registered office are necessary documents. Any of the utility bills (electricity, gas, telephone or water) not more than 2 months old, bearing the name of the landlord and the complete address are also needed.
Advantages & Benefits
Reasons that make LLP company registration in India an appealing option
Personal Assets Protection
A huge advantage that a LLP partner enjoys is that all his/her personal property and assets are safeguarded from company’s debt as a partner’s responsibility is limited to the investment made by him/her in the venture.
No Audit Required
A notable benefit that a company enjoys after LLP registration in India is that no mandatory accounts audit is required for a company whose contribution does not exceed Rs 25,00,000 and the annual turnover is not in excess of Rs 40,00,000.
Easy Funding Options
LLP company is a regulated body and unlike sole proprietorship firms and partnerships, it can approach various sources like private equity investors or venture capitalist apart from banks in order to raise funds.
Unlike a partnership firm, a LLP company’s existence is not endangered by the death or exit of a partner. A nominee listed in the MoA and AoA can take over after death or disability of a partner while transferring of ownership rights is easy and can be specified in the LLP Agreement.
Frequently Asked Questions
WHAT IS THE DIFFERENCE BETWEEN LLP AND PRIVATE LIMITED COMPANY?
An LLP consists of partners whereas a private limited company has shareholders
WHO IS RESPONSIBLE FOR MISCONDUCT OR NEGLIGENCE IN LLP?
A Partner who has done any misconduct is responsible for his own act, not the other partners.
WHAT IS (DPIN) DESIGNATED PARTNER IDENTIFICATION NUMBER?
The Unique Number is required to allot to an Individual which remains valid for whole life of the individual and is required to become Partner of any LLP.
HOW CAN WE SELECT A NAME OF THE LLP?
Firstly we just need to find a unique name as prefix and promoters need to provide a name of the proposed LLP along with the significance of the word. Secondly, the name needs to include a word about the LLP business activity. Finally, before selecting Names it will be advisable to check on Google, MCA Portal, MCA Guidelines and Trade Mark site the availability of Name.
DO PARTNERS HAVE TO BE PRESENT PERSONALLY TO INCORPORATE A LLP?
No, partners are not required to present personally because documents can be filed online at any place.
HOW MUCH TIME WILL IT TAKES TO INCORPORATE A LLP?
To incorporate an LLP we required approximately 22 working days. The time taken for incorporation will depend on submission of relevant documents by the client and speed of Government Approvals. To ensure a speedy process of incorporation, please choose a unique name for your LLP and ensure you have all the required documents are provided before starting the incorporation process.
IS COST OF INCORPORATING A LLP IS LESSER THAN A PRIVATE LIMITED COMPANY?
The cost of registration is almost the same for both.
CAN A LLP OWNS PROPERTY IN ITS NAME?
An LLP can own and enjoy property in its own name, partners are not owners of the company’s property.