LLP Registration
Benefits Of An LLP
The major reasons why people prefer the structure of an LLP for their business structure:
Limited Liability
- The members of an LLP are only liable for a small amount of debt incurred by it.
- On the other hand, for proprietorships and partnerships, the personal assets of directors and partners are not protected if the business goes bankrupt.
Separate Legal Entity
- An LLP is a separate legal entity from the partners in it.
- It has an uninterrupted existence that follows perpetual succession, i.e., the partners might leave, but the business remains. The terms of dissolution have to be mutually agreed upon for the firm to dissolve.
Flexible Agreement
- Transferring the ownership of an LLP is also simple.
- A person can easily be inducted as a designated partner and the ownership switches to them.
Suitable For Small Business
- LLPs having a capital amount less than ₹25 lakhs and turnover below ₹40 lakhs per year do not require any formal audits.
- This makes registering as an LLP beneficial for small businesses and start-ups.
Eligibility Criteria
To be eligible for registering as an LLP, the following criteria must be met:
- At least two partners are required to form an LLP (no upper limit)
- If a body corporate is a partner, a natural person must be nominated to represent it
- Each partner must have an agreed contribution towards the shared capital
- LLP should have an authorized capital of at least ₹1 lakh
- At least one designated partner should be an Indian resident.
Checklist For Registering A Company In India
As defined by the Companies Act 2013, we must guarantee that the checklist requirements are met.
Two Directors:
A private limited company must have at least two directors, with a maximum of fifteen. A minimum of one of the company’s directors must be a resident of India.
Unique Name:
The name of your business must be unique. The suggested name should not match with any existing companies or trademarks in India.
Minimum Capital Contribution:
There is no minimum capital amount for a company. A company should have an authorized capital of at least ₹1 lakh.
Registered Office:
The registered office of a company does not have to be a commercial space. Even a rented home can be the registered office, so long as an NOC is obtained from the landlord.
Documents Required For LLP Registration
To register an LLP you need scanned copies of the following documents:
From partners:
- PAN card or passport (foreign nationals or NRIs)
- Aadhar card/ voter’s ID/ passport/ driving license
- Latest bank statement/ telephone bill/ mobile bill/ electricity bill/ gas bill
- Passport-size photograph
- Blank document with specimen signature.
Note: One partner must self-attest the first three documents. In the case of foreign nationals or NRIs, all the documents must be notarized (if currently in India or a non-commonwealth country) or apostilled (if from a commonwealth country).
For the registered office:
- Utility bills
- Notarized rental agreement in English
- No-objection certificate from the property owner
- Sale deed/property deed in English (in case of owned property).
How to Register an LLP Online with Relitrade Consultancy
You can register LLP online through Relitrade Consultancy. While we make LLP registration a simple 3-step process for you, the actual registration process is elaborate and is explained below for your knowledge:
Step 1: Obtaining DSC and DIN
All the forms that need to be submitted online require the directors’ DSC. So, the first step in the process is to get DSCs and DINs for 2 partners. We collect the necessary information from you and file for them.
Step 2: Application for Name Approval
Simultaneously, we check if the name you want to register under is available and reserve it for your LLP. You can check for name availability in the MCA portal.
The approval of the name will be made by the registrar only if the central government does not deem it undesirable. The name should not hold any resemblance to any of the existing partnership firms, LLPs, trademarks, or body corporates.
Step 3: LLP Agreement
The next step is to draft the LLP agreement and other documents for registration. An LLP agreement is very crucial in a limited liability partnership as it determines the mutual rights and duties amongst the partners, and between the LLP and the partners. Thus, our experts take utmost care in drafting this agreement.
The partners enter into the LLP agreement upon registering the LLP by filing Form 3 online on the MCA portal. This procedure has to be done within 30 days of the date of incorporation.
Step 4: LLP Incorporation Certificate
Our team will file the necessary forms and documents with the registrar. Once the registrar approves all the forms and documents, you get your LLP incorporation certificate and are almost set for running your business.
Step 5: Apply for Your PAN, TAN, & Bank Account
As soon as you get the incorporation certificate, we will apply for the PAN, TAN, and bank account for your LLP.
Our Relitrade Consultancy experts are up to date with the laws and have helped businesses like you register their LLP.
Our support team is available to answer any questions you may have
FAQs
Q.1 What is Limited Liability Partnership?
LLP is an alternative corporate business form that it gives the benefits of limited liability of a company and the flexibility of a partnership. The LLP can continue its existence irrespective of changes in partners. It is capable of entering into contracts and holding property in its own name. The LLP is a separate legal entity, is liable to the full extent of its assets but liability of the partners is limited to their agreed contribution in the LLP.
Q.2 What is the minimum number of partners required to start LLP?
A minimum two partners are required to start an LLP.
Q.3 How to form/incorporate an LLP?
The procedure for formation of an LLP is very similar to that of a Private Limited Company incorporation procedure. A minimum of two Partners are required to start the LLP formation procedure and a registered office location is required within India. It is important to remember that FDI in LLP is allowed only with the prior approval of the Reserve Bank of India (RBI). Therefore, it is recommended that NRIs and Foreign National promoters opt to incorporate a Private Limited Company, where 100% FDI is allowed under the automatic route.
Q.4 How can I get an LLP registered in India?
To register a Indian LLP, you need to first apply for a Designated Partner Identification Number (DPIN), which can be done by filing eForm for acquiring the DIN or DPIN. You would then need to acquire your Digital Signature Certificate and register the same on the portal. Thereafter, you need to get the LLP name approved by the Ministry. Once the LLP name is approved, you can register the LLP by filing the incorporation form.
Q.5 What is the procedure for LLP registration in India?
LLP registration procedure is the easiest and transparent process as it has a blend of the benefits of a company and partnership firm namely, limited liability feature of a company and the flexibility of a Partnership firm. LLP registration process includes following steps:
- Get a digital signature (DSC)
- Apply for Director Identification Number (DIN)
- Get the name of the company approved through ‘Reserve your Unique Name’ service (RUN)
- Incorporation of LLP
- File ‘Limited Liability Partnership Agreement
Q.6 Is there any government fees to register LLP in India? How much does it cost?
Following are the details of the fees levied by the Government for the registration of LLP.
- Digital signature (DSC) – Rupees 1500-2000 (Depending on the Agency)
- Apply for Director Identification Number (DIN) – Rupees 1000 for two partners
- Get the name of the company approved through ‘Reserve your Unique Name’ service (RUN) – Rupees 200
- Incorporation of LLP- Depends on capital contribution: Contribution up to Rs. 1 lakh – Rs. 500, Contribution between Rs. 1 and 5 lakhs – Rs. 2000
- File ‘Limited Liability Partnership Agreement- Depends on capital contribution. Contribution up to Rs 1 lakhs – Rs 50 for filing Form 3 and stamp duty based on the state where LLP is formed
Q.7 How can I convert my existing partnership firm into LLP?
Any existing partnership firm that is willing to get converted into LLP will need to apply through Form 17 (Application and statement for the conversion of a firm into LLP. Form 17 needs to be filed along with Form 2 (Incorporation document and Subscriber’s statement).
Q.8 Who can become a partner in LLP?
Any individual or body corporate may be a partner in an LLP. However, an individual shall not be capable of becoming a partner of an LLP, if—
a) he has been found to be of unsound mind by a Court of competent jurisdiction and the finding is in force;
b) he is an undischarged insolvent; or
c) he has applied to be adjudicated as an insolvent and his application is pending.
Q.9 What are the documents required for LLP registration?
To register an LLP in India, the following documents are required:
- PAN Card of the Partners
- Address Proof of the Partners
- Utility Bill of the proposed Registered Office of the LLP
- No-Objection Certificate from the Landlord
- Rental Agreement Copy between the LLP and the Landlord
Q.10 What is the cost of setting an LLP of an exim business?
Following are the Government charges to register an LLP as an Exim business:
- Digital signature (DSC) – Rupees 1500-2000 (Depending on the Agency)
- Apply for Director Identification Number (DIN) – Rupees 1000 for two partners
- Get the name of the company approved through ‘Reserve your Unique Name’ service (RUN) – Rupees 200
- Incorporation of LLP– Depends on capital contribution: Contribution up to Rs. 1 lakhs – Rs. 500, Contribution between Rs. 1 and 5 lakhs – Rs. 2000
- File ‘Limited Liability Partnership Agreement– Depends on capital contribution. Contribution up to Rs 1 lakhs
- Rs 50 for filing Form 3 and stamp duty based on the state where LLP is formed
- IEC license: The Government fees for IEC code registration would be Rupees 250 to 300These are the government costs of registering an LLP for an Exim business, however you will need to pay a few bucks more for professional services which is highly advisable.
Q.11 What is the difference between partner and designated partner at LLP in India?
- Designated partner are like Director and partners are like shareholders.
- The liability of the Partner is limited solely to Partnership Agreement. The Designated Partners are responsible towards the day to day functioning , liabilities prescribed by LLP Agreement as well as for all penalties imposed on Limited Liability Partners for contravention of any provisions applicable and to be complied with by the LLP.
