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Advantages Documents Cost Process FAQ’S

What is LLP Registration

LLP stands for Limited Liability Partnership. It is an alternative corporate business form which offers the benefits of limited liability to the partners at low compliance costs. It also allows the partners to organize their internal structure like a traditional partnership. A limited liability partnership is a legal entity, liable for the full extent of its assets. The liability of the partners, however, is limited. Hence, LLP is a hybrid between a company and a partnership. But it should not be confused with Limited Liability Company.

LLP is one of the easiest types of business to incorporate and manage in India. With an easy incorporation process and simple compliance formalities, LLPs are preferred by Professionals, Micro and Small businesses that are family-owned or closely-held. Since LLPs are not capable of issuing equity shares, LLP should NOT be chosen for any business that has plans for raising equity funds from Angel Investors, Venture Capitalist or Private Equity Funds.

Limited Liability Partnership is managed as per the LLP Agreement, however in the absence of such agreement the LLP would be governed by the framework provided under Limited Liability Partnership Act, 2008 (LLP act). LLP registration process is less complex than other form of business.

Kshitij T & L Consultancy being the professionally managed firm provides LLP registration online within 15 working days, subject to government processing time. Our professionals help in estimating the LLP registration cost, documents required for LLP registration and hassle free procedure for Limited Liability Partnership (LLP) registration.

Advantages of LLP Registration :


1. Convenient

It is easy to start and manage a business like entrepreneurs. LLP agreements are customized in according to meet the needs of partners concerned. There are fewer formalities in areas of legal compilation, annual meeting, resolution as compared to any other Private Limited Company. For a detailed comparison between LLP and Private Limited read Choosing between LLP and Private Limited.

2. No minimum capital requirement

LLP can be started with the minimum amount of capital money. Capital may be in the form of tangible, movable asset like Land, machinery or intangible form. Capital requirement in the case of a Private company (Requirements for Registration of a Private Company) and Public Company (Requirements for registration of a Public Company) is Rs. 1, 00,000 and Rs. 5,00,000 respectively whereas no such mandatory capital requirement specified under the LLP.

3. No limit on owners of business

LLP may have partners varying from 2 to many. There is no limit for partners in LLP. An LLP requires a minimum 2 partners while there is no limit on the maximum number of partners in contrast to a private company wherein there is a restriction of not having more than 200 members.

4. Lower Registration Cost

The cost of registration of LLP is low as compared to any other company (Public or Private). Read a Cost Comparison of LLP, OPC, private limited, partnership, and proprietorship

5. No requirement of compulsory Audit

LLPs are not required to audit the accounts. Any other company (Public, Private) are mandated to get their accounts audited by the auditing firm. LLP is required to audit their account in the following situation:
• When the contributions of the LLP exceeds Rs. 25 Lakhs, or
• When annual turnover of the LLP exceeds Rs. 40 Lakhs

6. Savings from lower compliance burden

LLP have to face less compliance burden as they have to submit only two statements i.e. the Annual Return & Statement of Accounts and Solvency. Whereas in the case of private company, at Least 8 to 10 regulatory formalities and compliances are required to be duly completed. Read Annual Cost Comparison of Private Limited and LLP.

7. Taxation Aspect on LLP

LLP is not liable to pay the tax on the income and share of its partner. Thus, no dividend distribution tax is payable as under section 40(b). Bonus, commission or remuneration, Interest to partners, any payment of salary, allowed as deduction. Provision of ‘deemed dividend’ under income tax law, is not applicable to LLP.

Documents For LLP Registration


company formation

Passport size Photograph

firm registration

Copy of PAN Card

Incorporation company

Copy of Aadhar Card

Limited liability

Address Proof (Bank Statement/Mobile/Telephone Bill)

Limited liability

Copy of Electricity Bil

Limited liability partnership registration

Sale Deed (if owned)

Company registration

Copy of rent agreement
(if rented)

Company formation

NOC

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PACKAGES


Basic


(All Inclusive)

Get Started

Standard


(All Inclusive)

2 DIN
2 DSC
PAN & TAN
Name Approval
Drafting of LLP Agreement
Certificate of Incorporation
GST registration
Trademark Filing
Udyog Aadhaar Registration (MSME)
Certification Under PF Act
Certification Under ESIC Act
Certification Under PT Act

Get Started

Primium


(All Inclusive)

Get Started

Note:

  • The above price may vary as per contribution made by partners
  • LLP Agreement has to notarized by the client as per their state stamp duty
  • Trademark filing excludes government fees

Process involved in registering a LLP

1

Obtain digital signature for the partners.

2

Apply for the DIN (Director Identification Number) which is necessary to become a partner in the LLP.

3

Apply for the name approval for the LLP registration.

4

Registrar of Companies issues the Certificate of Incorporation which is the proof for the registration.

5

File for a Permanent Account Number (PAN)

6

File LLP agreements and open a current bank account.

Mandatory Requirements for Limited Liability Partnership LLP Registration

DPIN and DSC of all the Directors


Minimum 2 Designated Partners


There should be some amount as contribution


At least one Indian resident Designated Partner out of two.

Registered office address in India


Execution of LLP agreement between the partners

00+

Satisfied Entrepreneurs

00+

Team strength

00 years+

Professional Experience

00+

Services delivered

Why to choose LLP Registration ?

1. LLP firms
are very flexible in terms of internal organization structure as they are simpler in nature.

2. There is no limit
that has been mentioned regarding the number of partners.

3. Funds raising and
utilization can only be done under the norms of ACT 2013.

4. LLP firm is not
in need to pay Dividend Distribution Tax as they are an exception by rules.

5. White collar job
people generally go with LLP for the flexibility it offers.

6. Audit is not
in LLP mandatory unlike private or public incorporations.

Important clauses of a LLP agreement :

  • The actual time frame of the existence of the LLP.
  • The profit sharing model between the partners.
  • The roles and powers to be defined for individual partner basis.
  • Other points such as admission, expulsion, retirement, remuneration of partners.

Mandatory Compliances of a LLP every year

  • form 8- Statement of accounts on or before 30th, October every year
  • Form 11-Annual return on or before 31st, march every year
  • Statutory audit by a chartered accountant above turnover Rs 40 lac or contribution Rs 25 lac
  • Filing of ITR

Here is the break down for helping you to decide your form of business

S.No. Particulars Partnership Private Limited LLP
1 Foreign Participation Foreign National cannot be the partners in a Partnership firm. Foreign national can be a member in a Company./td> Foreign National can be a partner in a LLP.
2 Tax Liability Taxed at 30% plus surcharge and cess as applicable. Taxed at a rate of 30% plus Surcharged education cess Taxed at a rate of 30% plus education cess
3 Transfer of Shares Not Applicable Ownership is easily transferable by the way of transfer of shares. Transfer are governed by the LLP agreement.
4 Annual Filing No return is required to be filed Returns is required to be filed with ROC every year.. Returns is required to be filed every year.
5 Audit of accounts Required to have tax audit of their accounts Required to get their accounts audited annually Having turnover less than 40lacs or contribution less than 25 lac in financial year required to get their accounts audited annually.
6 Rights/Duties/ Rights/Duties/ obligation of the partners/Managing Partners/ Directors Governed by Partnership deed Governed by AOA and resolutions passed by shareholders or Directors Governed by LLP agreement
7 Registration Registration is optional Registration with ROC is required. Registration with ROC is required.
8 Cost of formation Nominal cost of creating a firm Minimum government fee for incorporation of private company is 6,000-7,000 approx/- The cost of formation of LLP is lesser than the formation of company.

FAQ’s about LLP registration

  • How can a person become a partner of an LLP?
    Persons, who subscribed to the “Incorporation Document” at the time of incorporation of LLP, shall be partners of LLP. Subsequent to incorporation, new partners can be admitted in the LLP as per conditions and requirements of LLP Agreement.

  • Can a NRI be a partner in LLP?
    Yes, absolutely provided they have valid documents but, at least one of the partner should be from India and should be residing here.

  • Whether audit of all LLPs would be mandatory?
    Audit of LLPs shall be mandatory. However a more simplified compliance regime for small LLPs is being proposed by exempting such LLPs from the requirement of audit by exemption through notification by the Central Government.

  • Can two LLP’s merge eventually?
    Yes, it is absolutely possible for 2 companies of set rules can merge under the Provisions of clauses 60 to 62 of the Act.

  • Is it possible for a charity to register as an LLP company?
    Nope, not at all possible as the LLP only provides rules for companies that are intended to generate profit.

  • What are benefits and expectations of LLP in India?
    • 1. From taxation point of view a LLP incorporation is treated like other partnership firms.
    • 2. The company is limited to the agreement deed between the partners.
    • 3. The partners are protected against joint liability if such situations occur, they are responsible and liable for their own actions.
    • 4. LLP has separate legal entity where the company and the partners are treated individually.
    • 5. There is no rule where the minimum capital are defined.
    • 6. Audit is not a mandatory unlike private or public incorporations.
      The rules, provisions, and regulations given in the Section 406 of the Companies Act 2013, and in the companies (Nidhi Companies) Rule of 2014, govern and regulate all Nidhi Companies in entire INDIA. Again the activities of Nidhi Companies fall under the ambit of RBI Directives which govern activities of NBFCs and other institutions dealing with financing and investment. RBI offers certain exemptions to the Nidhi Companies based on the fact that these Nidhi Companies deal only with its members, and with no outside people or investors

  • What are the guidelines for selecting the name of a LLP ?
    • 1. The actual name and the object of the company can differ and there are no rules that specify that they should be targeted for the same consonance.
    • 2. The partners have the option of using their initials as the name of the company which also could be abbreviated
    • 3. The company name can be standard and is not required to change with the change in business.
    • 4. No NOC is required.

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