How to Register an LLP Online in India?
A Limited Liability Partnership (LLP) is a type of business entity that combines the features of a partnership and a company. It is owned by two or more partners who share the profits and losses of the business but have limited liability for the debts and obligations of the LLP. It is a separate legal entity that can sue and be sued own property, enter into contracts, etc. It is also more flexible and less regulated than a company, as it does not have to comply with many provisions of the Companies Act, 2013. A LLP is suitable for small and medium-sized businesses that require minimal capital investment and compliance. In this article, we will provide an overview of how to register an LLP online in India, along with the applicable rules, regulations, eligibility, documents, procedure, validity, renewal, cancellation, and compliance.
Applicable Rules/ Acts/ Regulations
The main rules, acts, and regulations that apply to the registration and operation of an LLP in India are:
- The Limited Liability Partnership Act, 2008: This is the main act that governs the incorporation, management, regulation, and dissolution of LLPs in India. It also prescribes the roles, duties, rights, and liabilities of the partners, designated partners, auditors, etc. of an LLP.
- The Limited Liability Partnership Rules, 2009: These are the rules that specify the procedure and requirements for the incorporation of an LLP in India. They also provide the formats and templates for various forms and documents required for the incorporation process.
- The Income Tax Act, 1961: This is the act that levies tax on the income of individuals and entities in India. It also provides various tax deductions and exemptions for LLPs based on their turnover, profits, investments, etc.
- The Goods and Services Tax Act, 2017: This is the act that imposes a comprehensive indirect tax on the supply of goods and services in India. It also provides various tax rates and slabs for different categories of goods and services.
Eligibility Criteria to register an LLP Online in India
To register an LLP online in India, the following eligibility criteria and pre-requisites must be met:
- The minimum number of partners required for an LLP is 2. There is no maximum limit on the number of partners.
- At least one partner must be a resident of India.
- At least two partners must be designated partners who are responsible for the management and administration of the LLP. One of them must be a resident of India.
- The proposed name of the LLP must be unique and not similar to any existing LLP or company or trademark. It must also end with the words “Limited Liability Partnership” or “LLP”.
- The proposed objects of the LLP must be lawful and not against public policy or interest.
- The proposed registered office address of the LLP must be in India.
A detailed description of the products/services
LLP online registration is a service that helps you incorporate your own limited liability partnership online in India with ease and convenience. It involves obtaining various approvals, certificates, numbers, etc. from various authorities such as the Ministry of Corporate Affairs (MCA), the Income Tax Department, the GST Department, etc. It also involves drafting various documents such as LLP agreement, COI, etc. that define the constitution and structure of your LLP. It also helps you comply with various laws and regulations applicable to your LLP.
Types and distinctions of Licenses/Services involved in LLP Registration
There are different types of licenses/services involved in the process of LLP online registration in India. Some of them are:
- LLP name approval: This is the first step in the process of incorporation. It involves applying for the reservation of your proposed LLP name on [the MCA portal] using Form FiLLiP Part A. You can suggest up to six names for your LLP along with their significance and relevance. The MCA will approve or reject your name application within one working day based on its availability and suitability.
- Digital Signature Certificate (DSC) and Designated Partner Identification Number (DPIN): These are electronic signatures that are used to sign various forms and documents online. They are mandatory for all designated partners of an LLP to obtain their DSC from any authorized agency before applying for incorporation. The DPIN is a unique identification number that is allotted to every designated partner of an LLP by the MCA. The DPIN can be obtained by submitting an application form along with identity proof, address proof, PAN card, etc.
- Limited Liability Partnership Agreement: This is the key document that defines the constitution and structure of your LLP. It specifies the name, objects, capital, liability, profit sharing ratio, management, dissolution, etc. of your LLP. It also specifies the rights and duties of the partners and designated partners of your LLP. This document can be drafted by using the standard template provided by the MCA or by customizing it as per your requirements.
- Certificate of Incorporation (COI): This is the final document that certifies the incorporation of your LLP by the MCA. It contains the name, address, date, and registration number of your LLP. It also contains the names and addresses of the partners and designated partners of your LLP. The COI can be obtained by submitting Form FiLLiP along with LLP agreement, DSC, DPIN, etc. on [the MCA portal]. The MCA will issue the COI within one to two working days after verifying your application and documents.
- PAN and TAN allotment: PAN (permanent account number) and TAN (tax deduction and collection account number) are mandatory for all LLPs in India for tax purposes. PAN is a 10-digit alphanumeric number that is used to identify your LLP for income tax purposes. TAN is a 10-digit alphanumeric number that is used to deduct and collect tax at source from payments made by your LLP. PAN and TAN can be obtained automatically along with COI by submitting Form FiLLiP on [the MCA portal]. You will receive your PAN and TAN cards within 10 to 15 working days after receiving your COI.
- GST Registration: GST (goods and services tax) is a comprehensive indirect tax that is levied on the supply of goods and services in India. It is mandatory for all LLPs in India to register under GST if their annual turnover exceeds Rs. 40 lakhs (Rs. 20 lakhs for special category states). GST registration can be obtained online by submitting Form GST REG-01 on [the GST portal] along with COI, PAN, bank account details, etc. You will receive your GSTIN (GST identification number) within three working days after submitting your application.
Documents Required/Paperwork required to register an LLP
The documents required to register an LLP online in India vary depending on the type of license/service involved. However, some common documents that are required for all licenses/services are:
- Identity proof of partners and designated partners (such as PAN card, Aadhaar card, passport, driving license, voter ID card, etc.)
- Address proof of partners and designated partners (such as electricity bill, telephone bill, bank statement, rent agreement, etc.)
- Passport size photographs of partners and designated partners
- Proof of registered office address of the LLP (such as electricity bill, telephone bill, rent agreement, ownership deed, NOC from owner, etc.)
- Specimen signature of partners and designated partners.
Some additional documents that may be required for specific licenses/services are:
- DSC application form and declaration form
- DPIN application form and declaration form
- LLP agreement drafting form
- Form FiLLiP Part A and Part B
- Form GST REG-01
Step-by-step process to register an LLP Online in India
The basic procedure to register an LLP Online in India is as follows:
- Choose a unique and suitable name for your LLP and apply for its reservation on [the MCA portal] using Form FiLLiP Part A.
- Obtain DSC and DPIN for all designated partners from any authorized agency or through [the MCA portal] using Form FiLLiP Part B.
- Draft LLP agreement for your LLP using the standard template or customizing it as per your requirements.
- Apply for incorporation of your LLP on [the MCA portal] using Form FiLLiP along with LLP agreement, DSC, DPIN, etc.
- Receive COI along with PAN and TAN cards from the MCA within one to two working days after verification.
- Apply for GST registration on [the GST portal] using Form GST REG-01 along with COI, PAN, bank account details, etc.
- Receive GSTIN from the GST Department within three working days after verification.
Cancellation/Validity/ Renewal of LLP Registration
The cancellation/validity/renewal of LLP registration in India depend on the type of license/service involved. For example:
- LLP name approval: This approval is valid for three months from the date of reservation. It can be cancelled by not applying for incorporation within the validity period.
- DSC and DPIN: These are valid for a lifetime and do not require any renewal. They can be cancelled by surrendering them to the MCA or by revoking them due to any misuse or fraud.
- LLP agreement: This is valid until it is altered or amended by the LLP. It can be cancelled by passing a resolution by the partners and filing Form 3 with the MCA within 30 days of the change.
- COI, PAN and TAN: These are valid for a lifetime and do not require any renewal. They can be cancelled by winding up or dissolving the LLP or by surrendering them to the respective authorities.
- GSTIN: This is valid until it is cancelled or surrendered by the LLP. It can be cancelled by applying online on [the GST portal] using Form GST REG-16 along with the required documents and reasons. It can also be cancelled by the GST Department due to any violations or non-compliance with the GST laws and regulations.
In conclusion, we have seen that registering an LLP online in India is a simple and convenient process that offers many benefits for small and medium-sized businesses. By following the steps and requirements outlined in this article, you can easily incorporate your own LLP online in India and enjoy the advantages of limited liability, flexibility, tax efficiency, etc. However, you should also be aware of the challenges and compliance of running an LLP, such as maintaining proper books of accounts, filing annual returns, paying taxes, etc. Therefore, you should carefully weigh the pros and cons of this option and choose the one that best suits your business needs and goals.