Starting a Limited Liability Partnership (LLP)
What is it?
Limited Liability Partnership (LLP) is an alternative business vehicle regulated under the Limited Liability Partnerships Act 2012 which combines the characteristics of a company and a conventional partnership.
Amongst others, LLP is featured with the protection of limited liability to its partners similar to the limited liability enjoyed by shareholders of a company coupled with flexibility of internal business regulation through partnership arrangement similar to a conventional partnership.
Any debts and obligations of the LLP will be borne by the assets of the LLP and not that of its partners’. An LLP has the legal status of a body corporate which is capable of suing and being sued in its own name, holding assets and doing such other acts and things in its name as bodies corporate may lawfully do and suffer.
LLP also offers flexibility in terms of its formation, maintenance and termination while simultaneously has the necessary dynamics and appeal to be able to compete domestically and internationally. With the introduction of LLP, entrepreneurs will have more options to choose the most preferred form of business vehicle.
Documents Required for LLP Registration
- Self attested copy of PAN card of all Directors – 2 Copies
- Four passport size photograph of each Director
- Copy of any utility bill or bank statement in the name of Directors
- Mobile & Email of all Directors, 2-3 proposed Name & Objects of Company
- Copy of Business proof of premises where company will be registered
- Self attested copy of address proof of all Directors – 2 copies, Anyone of Passport/Voter ID/Driving Lincense/Aadhar Card
- Incase of rented premises – Rent agreement + Latest electricity bill in the name of landlord + NOC
- Incase of owned premises – Copy of sale Deed + Latest electricity bill in the name of owner
Concept of LLP?
LLP is an alternative corporate business form that gives the benefits of limited liability of a COMPANY and the flexibility of a PARTNERSHIP. Since LLP contains elements of both ‘a corporate structure’ as well as ‘a partnership firm structure’ LLP is called a hybrid between a company and a partnership..
WHAT IS THE DIFFERENCE BETWEEN LLP & COMPANY?
A basic difference between an LLP and a joint stock company lies in that the internal governance structure of a company is regulated by statute (i.e. Companies Act, 1956) whereas for an LLP it would be by a contractual agreement between partners.
Who can register
- Small and medium business.
- Joint Venture.
- Venture Capital (Venture Capital)
HOW DO I CHOOSE NAME FOR THE LLP?
First ensure that LLP name is not similar to any other Private limited, OPC, LLP or Public limited company. Also, do check If your first is not a registered trademark taken by anybody under the IP act.Also, make sure the name is not too generic to be accepted by the ROC land also, try not to use abbreviations, adjectives.While choosing the name make sure that name should contain the objective of the business like if the objective is I then word is Technology, techno soft, IT consultancy. You can Check your company name from www.mca.gov.in
HOW LONG IS THE PROCESS OF LLP REGISTRATION
The Process of LLP Incorporation usually takes 15-20 working days.But some times due to extra work load of ROCs, this times may be increases.
CAN A SALARIED PERSON BECOME THE PARTNER IN LLP?
Yes, a salaried person can become the partner in LLP , but there should not any legal bondages with your employment agreement if it contains any restrictions on doing so.
IS IT ALLOWED TO CHANGE REGISTERED OFFICE OF THE LLP AFTER REGISTRATION?
Yes, A LLP can change its registered office any time after following specified procedure. The changed address can be situated within the same state or in a different state from the state in which it was originally registered.
What is the Capital required to start LLP?
You can start a Limited Liability Partnership with any amount of capital. There is no requirement to show proof of capital invested during the incorporation process. Partner’s contribution may consist of both tangible and/or intangible property and any other benefit to the LLP.