There are many ways to do business in India, including business through a company, partnership, sole proprietorship etc. You need to form a legal entity apart from yourself and do business under that name. Based on the field you are dealing in and the scale of your business, you can decide which type of legal entity you need to incorporate for your business. LLP is one of them regulated by the Limited Liability Partnership Act. It provides for registering your LLP before you start working under it.

What is LLP (Limited Liability Partnership)?

The Limited Liability Partnership (LLP) is a legal entity under which one can enjoy the benefits of limited liabilities and general partnership. The LLPs are governed by the Limited Liability Partnership Act 2008. It is an upgraded version of the general partnership. Under this system, the partners are known as Designated Partners and enjoy the benefits of limited liability.

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The Registration of LLP is a very simple process and is proffered most as you need to follow lesser compliances in a Limited Liability Partnership. LLPs are most recommended for professional firms and micro and small businesses that are family-owned or closely held. Under the provisions of the Limited Liability Partnership, the personal assets of the partners can't be used for paying the debts of the LLP. Designated partners are liable only to the extent of their contribution to the LLP mentioned in the agreement. Each partner is liable for their own decisions and not for the other partner's misconduct.

Who Can Incorporate an Limited Liability Partnership?

Any individual or corporate body can incorporate the Limited Liability Partnership if it satisfies the following conditions-

• He is of sound Mind.
• He is not insolvent or has discharged his debts after being insolvent.
• He has not applied for insolvency.

Suppose the abovementioned conditions are satisfied by a person or a corporate body. In that case, he can partner in a Limited Liability Partnership (LLP).

The Limited Liability Partnership has various benefits for the business; hence it is incorporated by many partners. Some of the major benefits of LLP are as follows-

• It is considered a separate legal entity. It has its own identity and liabilities.
• It is easy to incorporate, unlike companies. You just need to prepare the incorporation document and get it registered.
• Modification to the ownership of an LLP is very easy as it requires just the admission of a new partner and the withdrawal of the old one.
• It has many company features, one of which is perpetual succession. An LLP can operate even after the death of its partners. It does not automatically wind up on such occasions.
• Only two partners are required to incorporate the Limited Liability Partnership, and there is no upper limit. It makes it very flexible, and many partners can incorporate it.

Is Audit Required for LLP?

Audits are not required for Limited Liability Partnerships unless an LLP's contribution exceeds twenty-five lakh rupees, or the annual turnover exceeds forty lakh rupees. Still, if the partners wish to audit the accounts, then the accounts shall be audited. LLPs need to file annual returns with the Income Tax Department.

You must have the necessary documents to register your Limited Liability Partnership. The documents required for LLP Registration online are as follows-

• Photograph
• Identity Proof of Partners
• Address Proof of Partners
• Passport (for Foreign Nationals)
• PAN Card of Partners
• Bank Statement
• NOC From the Landlord
• LLP Agreement
• Subscriber Sheet
• Proof of Possession of Premises (Rent Agreement, Lease Deed etc.)
• Digital Signature Certificate (DSC)
• Designated Partner Identification Number (DPIN)

LLPs (Limited Liability Partnerships) must be registered with the Registrar of Companies (RoC). The following steps need to be followed to register your LLP-

Requirements for LLP Registration

• You should register on the web portal of the Ministry of Corporate Affairs.
• You should acquire the Digital Signature Certificate (DSC).
• The DSC is required to sign documents digitally which is compulsory in LLP Registration. They are used to fill various forms required for LLP Registration on the MCA portal.
• You should also acquire the Designated Partner Identification Number to use during Registration.

LLP Name Registration

• To reserve a name for your LLP, you must log into the MCA portal with the username and password you created at the time of Registration.
• After login, search for existing names before deciding the name of your LLP, then go to e-forms and choose form 1 for the name reservation.
• Fill in the details and submit the form. You need to enter the details of at least two designated partners.
• Finally, apply after signing it using the digital signature and paying the requisite fee. Later you can check the current status of your application by signing into the portal.

LLP Registration Process - Incorporation Procedure

• Once you register the name of your LLP, you can move on to the next step and incorporate your Limited Liability Partnership by registering it on the portal.
• For LLP Registration online, you must submit Form 2 (Incorporation Document and Statement) along with the LLP Registration Fees.
• The DPIN holding partner and the advocate involved in the incorporation process must sign the statement digitally.
• The Registrar of Companies will register the LLP after scrutinising the documents and verifying the details in compliance with the LLP Act and LLP Rules. This process may take up to fourteen days, and a certificate of incorporation is provided under Form 16.

LLP Agreement Filing Online

• If any changes are made in the incorporation document, you can file Form 3 along with the requisite fee.
• For the appointment of a partner, the designated partner or their consent, you must file Form 4 along with the fee.
• Form 3 and Form 4 can be submitted along with Form 2 or within 30 days of the incorporation.

The LLP Registration Fees (LLP) or fees for the conversion of any other institution into an LLP are as follows-

With our years of experience and in-depth knowledge of Partnership and LLP laws, our dedicated team at Corpseed understands the complexities involved in incorporating a Limited Liability Partnership. We provide comprehensive assistance to our clients, conducting thorough desk-based research, handling documentation, and facilitating coordination to ensure compliance with the laws governing a Limited Liability Partnership. Corpseed is your all-in-one solution for meeting your business needs.