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Steps of LLP registration,LLP registration steps

What is an LLP and How to register an LLP in India?

 

A Limited Liability Partnership (LLP) is a form of business that offers the combined features of ‘Partnership’ and ‘Limited Company’ business structures. This business form was introduced in India in April 2009 with the enactment of the Limited Liability Partnership Act, 2008. In an LLP, a partner is not responsible or liable for another partner's misconduct or negligence. Instead, all partners have limited liability, limited to their own acts of commission or omission, similar to shareholders’ liabilities in a limited company. However, unlike the shareholders in a company, LLP partners have the right to manage the business directly. An LLP also limits the personal liability of a partner for the errors, omissions, incompetence, or negligence of the LLP's employees or other agents. The management of the day-to-day business is outlined in the LLP Agreement, providing partners with the freedom to regulate the affairs of the business. LLP registration is administered by the Ministry of Corporate Affairs (MCA) through the Office of the Registrar of Companies. The incorporation process is fully electronic, similar to the company registration process, i.e. applications and documents are filed electronically and the Registrar issues a digitally signed Certificate of Incorporation (COI).

 
 

Why register a Limited Liability Partnership?

Registering an LLP offers many benefits with the main benefit being the limited liability of partners. The members of the firm are only liable for a small amount of debt incurred by it. This is entirely different from proprietorship and partnership where the personal assets of directors and partners are not protected if the business becomes bankrupt. Registering an LLP in India offers the following benefits-

  • LLP is a separate legal entity from the partners. Each partner can sue the other in case a situation arises. It has an uninterrupted existence that follows perpetual succession, i.e., the partners might leave, but the business remains. A term of dissolution has to be mutually agreed on for the firm to dissolve.

  • Transferring the ownership of LLP is also simple. A person can quickly be inducted in as a designated partner and the ownership switches to them.

  • LLPs having a capital amount less than 25 lakhs and turnover below 40 lakhs per year do not require any Statutory audit unlike a Private Limited Company, where it is mandatory . It makes registering as LLP beneficial for small businesses and startups.

  • A Limited Liability Partnership has partners, who own and manage the business. This is different from a private limited company, whose directors may be different from shareholders. For this reason, VCs do not invest in the LLP structure.

  • An LLP can own or acquire property because it is recognized as a juristic person. Partners of LLP cannot claim the property as theirs.

BENEFITS OF INCORPORATING AN LLP

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It is a separate legal entity from its partners.

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Induction of partner is simple.

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No requirement of audits for small business.

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No distinction between owner and partner.

 
 

Procedure For LLP Registration

Complete LLC Form

You need to fill our simple LLP online questionnaire and submit all the relevant “LLP documents”.

Obtain DSC and DPIN for

After submitting your documents we will provide you with both “DSC and DPIN”

Verification and Approval

Details provided by you will be verified & then we shall apply for LLP name approval.

Your LLP is Ready

Once Your LLP is Incorporated we will send you LLP Certificate

Steps to Register an LLP in India

1. Obtain DSC and DIN of partners

The first step is to obtain the Digital Signature Certificatete of the desired partners of the Limited Liability Partnership. The reason for this is that all the forms need to be submitted online and require the directors' digital signatures. The law also requires that all directors file for a DIN number. The application has to be made in Form DIR- 3.

2. Application For Name Approval

This process involves registering the LLP. Before you do this, you would need to see if the name is already taken. You can check on the free search facility on the MCA portal. The registrar only approves LLP names that are not taken before. The approval of the name will be made by the Registrar only if the Central Government does not deem it undesirable. The name should also not hold any resemblance to any of the existing partnership firms, LLPs, trademarks, or body corporates.

3.Filing of LLP Incorporation Documents with MCA

LLP Registration filing consists of preparation and filing of E-Form FiLLip with MCA with required documents. All the documents executed and attested as per documentation requirements has to be attached to the E-Form FiLLip and has to be digitally signed with the Digital Signature Certificate (DSC) of all the proposed Partners and Designated Partners.

4. LLP Agreement

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. The partners enter into the LLP agreement upon the LLP registration by filing form 3 online on the MCA portal. This procedure has to be done within 30 days of the date of incorporation.

5.Apply For PAN & TAN & Bank Account

As soon as you get the incorporation certificate, you need to apply for your company PAN & TAN with the NSDL. The cost for this procedure is less than Rs.200 and it takes around three weeks to get done

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What Documents will you need to register an LLP?

All the partners are required to provide their PAN at the time of registering LLP. PAN card acts as a primary ID proof.

Identity proof of director and

nominee(PAN card)

Address Proof of Partners

Partners should also provide their passport size photograph, preferably on white background.

Photograph

One of the designated partners needs to opt for a digital signature certificate since all documents and applications signed by the authorised signatory.

Digital Signature Certificate

Partner can submit anyone document out of Voter’s ID, Passport, Driver’s license or Aadhar Card. .

Latest bank statement, telephone bill, mobile bill, electricity bill or gas bill should be submitted as a residence proof.

Residence Proof of Partners

Address Proof of Partners

For becoming a partner in Indian LLP, foreign nationals and NRIs have to submit their passport compulsorily.

Passport (in case of Foreign Nationals/ NRIs)

 

How can we help in Registering your LLP in India?

The LLP Registration process is completely online, so you don't even have to leave your home to get your entity registered. At Register Karo, we complete the LLP Registration online within 14 days.​

​Register Karo's Limited Liability Partnership Registration package includes:

  • DIN and DSC for two Partners

  • LLP Agreement

  • Registration fees and stamp duty

  • Incorporation Certificate

  • LLP PAN and TAN

  • ZohoBooks Subscription

 

Frequently asked questions

What is the eligibility of designated partners/partners in an LLP?


Any individual, or even a company or an LLP, can become a partner. However, only an individual can become a ‘designated partner’ in an LLP.




I am an NRI. Can I form an LLP in India?


Yes, non-resident Indians and foreign nationals who are willing to enter into an LLP partnership can do so, provided they submit the necessary documents after getting it notarized by the concerned authorities. Although, at least one of the designated partners in an LLP should be the Indian national.




What is an LLP agreement?


An LLP agreement is one that is made between the partners and the LLP regarding the relationship between the individual partners in the LLP. An LLP agreement usually consists of management policies, admission of new partners, profit sharing ratio, remuneration to partners and so on.




What is the minimum number of partners required to start LLP?


According to the LLP Act, a minimum of two designated partners are required to start an LLP. The designated partners are responsible for fulfilling all the essential requirements involved in starting and running an LLP.




What kind of start-ups commonly register LLPs?


Typically, only start-ups that will not be looking for venture capital funding register LLPs. This is because venture capitalists only invest in private and public limited companies.





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