Limited Liability Partnership or LLP registration can be done online easily. LLP is becoming a preferable form of organization for small business owners. In this blog, we shall discuss what is LLP, how to register LLP, the govt fees for LLP registration, and the time involved in the LLP registration process.
What is an LLP?
The concept of Limited Liability Partnership or LLP was introduced in India through the Limited Liability Partnership (LLP) Act, 2008. The basic fundamental principle behind the LLP introduction is to maintain a business entity which provides limited liability to the owners. LLPs were introduced in 2010 and since then, they have received well with more than One lakhs registrations.
The prime advantage of an LLP is that one partner is not responsible or liable for the other partner’s negligence or misconduct. It also provides limited liability protection from the debts of the LLP for the owners. In other words, we can say that all the partners in an LLP enjoy limited liability protection. Also, the partners in an LLP can manage the business directly.
The LLP incorporation process is easy and includes simple compliance formalities. The LLPs are mostly preferred by Micro, Small, and Medium business owners.
What are the Benefits of Incorporating an LLP in India?
The following are the benefits of incorporating an LLP in India:
An LLP protects the personal assets of the members from the liabilities. In other words, an LLP is a separate legal entity to the entity members.
LLP offers a great amount of flexibility—operations and distribution of profits are determined through a written agreement. It results in better management of the business.
An LLP is presumed to be a legal person. Therefore, it can rent, lease, buy, own property, and even be held responsible.
What are the Documents required for LLP Registration?
The documents of the partners and LLP are required to register an LLP. The following are the documents required for LLP registration online:
|Documents of Partners||Documents of LLPs|
Now let us talk about the required documents in detail:
Documents of Partners
ID Proof/PAN Card of the Partners: The PAN Card of all the partners is required at the time of LLP registration. Since a PAN Card is linked to all other identity proofs, it acts as a primary ID proof.
Address Proof of the Partners: Any document among the Voter’s Card, Driving License, Passport, or Aadhaar Card can be submitted as the address proof of the partners. Noteworthy, the details, such as the name’s spelling, date of birth, etc. mentioned on the PAN card should be the same on the address proof.
Residence Proof of the Partners: Documents, such as bank statement, mobile bill, telephone bill, or electricity bill, can be submitted as a residence proof. Notably, the bills should not be more than 3 months old and the details such as name should match the PAN Card.
Photographs: The passport size photos of the partners (preferably with white background) should also be submitted along with other documents.
Passport: It is compulsory to submit the passport of the partner if he/she is an NRI. The address proof of the NRI must also be submitted along with the passport.
Documents of LLP
Address Proof of the Registered Office: The address proof of the registered office has to be submitted during the LLP registration. In case the registered office rented or leased, the rental agreement or lease deed along with the consent form of the owner of the premise and his/her identity proof has to be submitted. The address proof of the landlord must not be more than 2 months old.
Digital Signature Certificate: A digital signature certificate of one of the partners along with the documents must be submitted.
How to Register an LLP Online?
The LLP registration can be done online in a hassle-free manner. Follow the below-mentioned 5 steps to register LLP online:
Obtain DSC: A digital signature certificate of the designated person of the proposed LLP must be obtained before applying for LLP registration. The main reason behind obtaining DSC is that all the documents for the registration of the LLP are filed online. Therefore, a digital signature is required. A DSC can be obtained from a government-organized certifying agency.
Apply for DIN: The next step is to apply for the Director Signature Number of all the designated partners of the proposed LLP. The application for DIN can be made with Form DIR-3 and the scanned copies of the Aadhaar or PAN Card must be attached with it.
Name Reservation: The third step is to reserve a name for the LLP which shall be checked by the Central Registration Centre. It is recommended that you run an LLP registration name check, if the name you are selecting is free or not before you quote a name on the LLP registration MCA portal. The system there will recommend you other closely resembling names based on the name you are searching.
This will help in the choosing the name which is not similar to any existing name or trademarked name. And thus, your LLP name would be approved in the first go. The Form RUN-LLP must be filled to reserve the name.
In case, the name is rejected, the re-submission form must be submitted within 15 days. Also, there is a provision to propose 2 names in the RUN-LLP Form.
Incorporation of LLP
The Form for incorporation of Limited Liability Partnership (FiLLiP) shall be filed with the Registrar having jurisdiction in the state where the registered office of the LLP is situated.
Pay the fees as per the Annexure ‘A’.
With the incorporation form, an individual can also apply for the allotment of DPIN, if he/she is appointed as the designed partner in the LLP and does not have a DIN or DPIN.
The application for allotment of DPIN is allowed for two individuals only.
If the proposed name is approved by the Central Registration Centre, the approved name shall be filled as the name of the LLP.
File LLP Agreement: This agreement states the mutual duties and rights amongst the partners of the LLP. Also, between the LLP and the partners.
The LLP agreement must be filed in Form 3 online on the MCA portal. Notably, the Form can only be filled within the 30 days of the incorporation of the LLP.
Lastly, the LLP agreement must be printed on the Stamp paper.
How much does it cost to register an LLP in India?
Also Read: GST Return: How To File GST Return Online?
The govt fees for LLP registration is as follow:
|Step||LLP Registration Fees|
|Step 1: Obtain DSC|
|Step 2: Apply for DIN|
|Step 3: Name Reservation|
|Step 4: Incorporation of LLP||It depends on the capital contribution|
|Step 5: File LLP Agreement||It depends on the capital contribution|
How long does it take to Register LLP in India?
LLP registration takes approximately 15 days from obtaining DSC to Filing agreement, subject to the availability of the documents.