Limited Liability Partnership

A Limited Liability Partnership (LLP) is a business structure that combines the features of a traditional partnership and a corporation

This is the core benefit of an LLP. Partners’ liability for business debts and obligations is limited to their investment in the LLP. Unlike a general partnership, their assets (like a house or car) are protected if the business faces financial difficulties.

However, there might be exceptions. Partners could be held personally liable for their misconduct or negligence.

There must be at least two individuals or companies to form an LLP. Partners have the flexibility to define profit-sharing, management roles, and decision-making processes in a partnership agreement.

LLPs provide a business model that balances limited liability with the flexibility of a partnership. It’s a suitable option for businesses where professionals come together to offer services and share profits, with some protection for their assets.

Eligibility Criteria

  • In LLP there should minimum of two partners there is no maximum limit for the number of partners
  • Among the partners two must be designated partners responsible for regulatory and legal compliances
  • Both individuals and corporates can become partners in the LLP
  • At least one partner should be a resident of the country
  • There is no minimum capital requirement to form LLP
  • The partners must enter into a formal LLP agreement outlining the rights and duties of and obligations of each partner

Documents Required

Registration Process

You can register Limited Liability Partnership by following process

  • Digital Signature Certificate (DSC):  All the designated partner who manages the limited liability partnership must have DSC for online filing
  • Digital Identification Certificate (DIN): Each designated partner needs Digital Identification Number
  • Name Approval: Reserve a unique name for your limited liability partnership
  • You can propose upto six options
  • Incorporation: Once your name is approved you can file for incorporation these includes the details like the proposed business activities, address of the registered office and the information about the partner
  • LLP Agreement: Draft and execute a comprehensive agreement out ling the rights, responsibilities and profit ratios and dispute resolution mechanism for the partners.
  • File this agreement with the registrar within the 30 days of incorporation.
  • PAN and TAN Application: Apply for PAN and TAN for LLP these are for tax deduction purpose.