Limited Liability Partnership Firm Registration

Limited Liability Partnership is a type of partnership firm which is more preferred by entrepreneur. It is the easiest form of business structure with the benefit of limited liability. It gives freedom to partners to form a partnership structure where the liability of each partner is limited to the amount they contribute into the business. Having a limited liability means that if the partnership fails, creditors cannot ask for partner’s personal property or income.

What is Limited Liability Partnership Firm?

LLPs or Limited Liability Partnership is a type of business structure which offers extra benefits in comparison to partnership firm. It provides limited liability to its partners at a very nominal compliance costs. Moreover, the Partners of the firm can organize their internal structure like a partnership firm.

In short, LLP is a separate legal entity from its member that has the power to extend all its assets keeping the liabilities of partners limited. Hence, a Limited Liability Partnership is a hybrid of a company and a partnership firm.

Features of a Limited Liability Partnership Firm

• Corporate Body

  As per Section 3 of the LLP Act, 2008, a Limited Liability Partnership firm is a corporate body which has come into force with effect from April 1, 2009. The Indian Partnership Act 1932 is not applicable to LLP.

• Never Ending

  A Limited Liability Partnership firm has a benefit of perpetual succession and can continue its existence even after the retirement, death, insanity of one or more respective partners in the firm.

• Limited Liability

  The most important feature of LLP is limited liability that all its partners entertain which means their personal assets are safe and won’t be used to pay the losses or debt of the firm. Apart from it, innocent partners of the firm are not liable to pay for the wrong deeds done by some other partner.

• Least Requirements

  A person can start an LLP firm with just two partners out of which one should be an Indian resident. The designated partners can either be an individual or a corporate body. Moreover, there is no specific capital requirement to incorporate a limited liability partnership firm.

• The LLP Agreement

  An agreement is printed on a stamp paper and signed by all the partners that define their roles and duties in the firm. It helps them in the decision making process.

• Easy Online Registration and E-filling

  MCA has simplified LLP registration and made it an easy online procedure. The forms and the documents are filed electronically on the official MCA portal. A designated partner has to obtain DSC to sign these documents and forms.

• Easy Conversion

  If a public or private company or a partnership firm decides to emerge as a limited liability partnership, they can easily convert as per the provisions of the applicable act.

• Business Management

  The business is managed by the respective partners as per their roles and duties. The designated partners of the firm are responsible for the legal compliances.

• Profit Sharing Business

  Profit is equally shared amongst all the partners. An LLP cannot be incorporated for a charitable purpose. Its purpose is to carry on business activities with an aim to earn profit.

Types of Forms applicable for Limited Liability Partnership Firm Registration

Documents Required for Online Limited Liability Partnership Firm Registration

Documents for the Partners

• Pan Card/ Identity proof

  All the partners of the firm have to provide their PAN card at the time of LLP registration. It also works as a primary identity proof.

• Residential proof

  Respective partners can submit any documents including their passport, aadhar card, driving license or voter card. Make sure the details of the residential proof matches with the PAN card. In case there is a spelling mistake, get it corrected before the submission.

• Passport size photographs

  All the partners have to provide their passport size photographs with a white background.

• Passport

  It is mandatory for the NRIs and foreign nationals to submit a copy of the passport at the time of registration. The passport should be notarized by the relevant authorities or else can be done by the Indian embassy situated in the respective country.

  Apart from it, they have to submit a residential proof and if it is in some other language than English, attach a notarized or translation copy along with the documents.

Documents for the Firm

• Residential/ address proof

  An applicant requires to submit the residential proof of the registered office during or within 30 days of the registration. In case the registered office is on rent, a rent agreement along with the NOC (No Objection Certificate) has to be submitted.

  An applicant can submit any of the utility bills such as electricity, telephone, the gas bill for the residential proof. Make sure the bill is the latest one and should not be older than two months and contains the complete address of the concerned premises.

• DSC or Digital Signature Certificate

  Any of the designated partners of the firm can opt for a DSC that would be required to sign all the forms on a digital platform.

Procedure for Online Limited Liability Partnership Firm Registration

LLP registration is an easy online procedure that can be accomplished within 4 registration steps and 3 post incorporation steps.

Here is the step by step guide for Limited Liability Partnership firm Registration:

• Obtain a Digital Signature Certificate

  The first step is to obtain the DSC for a designated partner of the firm. DSC is important because LLP registration is an online process and all the documents are to be signed digitally. The designated partner has to obtain their DSC from the government recognized agency. The cost may vary from agency to agency. Make sure to obtain a class 3 or class 2 DSC certificate.

• Obtain a DPIN For All The Partners

  DPIN or Designated Identification Partners Number is mandatory for all the designated partners. Form DIR-3 is filed to obtain DPIN. The applicant has to attach a scanned copy of Aadhar card and PAN card along with the form which should be signed by the company’s secretary or by the Managing Director/CFO/CEO in which he/she is appointed as a director.

• Firm’s Name

  The third step is reserving a name for the firm. For that, an applicant has to file LLP-RUN form. The name should be unique and non-offensive. For this, you can use the free name search facility available on the MCA Portal. The system is quite helpful and provides a list of names resembling with your firm’s name. This would help you to select an appropriate name. An applicant can provide up to 2 names that would be further analyzed by the registrar of companies. In case of rejection/objection, you can re-submit your form after 15 days of the rejection.

• Firm’s Incorporation

  Once the name has been reserved you can move ahead to the incorporation of your LLP. For this, you have to file FiLLiP i.e. Form for incorporation of Limited Liability Partnership. It is filed with the registrar of the firm of the respective state in which the registered office is situated. Applicant has to pay a particular amount of incorporation fees as per the Annexure “A”.

  All the documents and applications are duly checked by the authorities and if all goes well, incorporation certificate is issued.

Post Incorporation Compliances

Just like registration procedure, post compliances are also important. Once the LLP has been incorporated, you have to fulfill post incorporation compliances that are for single time only.

• LLP Agreement

  LLP agreement is an important document that defines the rights and duties of all the respective members. It helps to avoid future conflicts and disputes in partners and hence help in maintaining peace and prosperity.

  It has to be filed on the MCA portal within 30 days of LLP incorporation. It shall be printed on a stamp paper and signed by all the partners of the firm. Value of the stamp paper varies from state to state.

• PAN and TAN

  Apply for PAN and TAN after the incorporation because without it firm cannot open a bank account for carrying out further transactions.

• Open a Bank Account

  Once you have got your PAN, open a bank account in the name of your firm to carry out financial transactions.

Total fees and time for Limited Liability Partnership Registration in India

It usually takes around 15 days to complete the whole process starting from obtaining a DSC to submission of LLP agreement. The fees may vary from state to state; here is an estimate of different government forms as follows: