What is a Limited Liability Partnership (LLP)?
A Limited Liability Partnership (LLP) is a partnership in which some or all of the partners have limited liability. Therefore, business may be conducted within the framework of a company with elements of a partnership company and a limited company and guided by the terms of a jointly adopted Articles of Incorporation. Under LLP, a partner is not responsible for another partner’s misconduct or negligence. A Limited Liability Partnership (LLP) was introduced in India by the Limited Liability Partnership Act, 2008 and has become the preferred organizational form among entrepreneurs as it combines the benefits of a partnership company and a corporation into a single organizational form. Lern more to register llp online.
What are the essential features of an LLP?
Separate legal entity: A limited liability partnership is legally recognized as a separate entity. Therefore, an LLP can have its PAN, bank accounts, licenses, permits, contracts, assets, and liabilities in its own name.
Limited Liability: Limited Liability Partners in a partnership are limited to the extent of their contributions to the LLP and under no circumstances may they use a partner’s personal property to relieve the LLP of liability.
Reduced compliance: tax compliance is similar for both the limited liability company and her LLP. However, LLPs have significant advantages when it comes to corporate affairs compliance. An LLP is not required to undergo an audit if the annual turnover of the LLP is less than his Rs. 400,000 rupees and the investment amount is less than 250,000 rupees. A limited liability company, on the other hand, is required to file audited financial statements annually, regardless of turnover.
Simplicity: The administrative process for forming and maintaining a
LLP is very simple compared to a limited liability company. How do I form a LLP?
An Limited Liability Partnership can be formed by submitting information to the Department of Enterprises website. To form an LLP, the following minimum requirements must be met:
Designated Partners:A limited liability partnership must have a minimum of 2 and a maximum of 200 designated partners and at least 1 Indian partner. A resident designated partner is required. Partner she must be over 18 years old. This is to ensure that LLP partners are not minors and have legal capacity.
Digital Signature Certificate (DSC): DSC is mandatory for all partners. Forms filed to set up a Limited Liability Partnership (LLP) in India have to be filed online after the DSC of the designated partner is attached.
Are there any minimum capital requirements to register an LLP in India?
There is no minimum capital required to set up an LLP in India. Therefore, an LLP can be incorporated with any capital. There are no minimum requirements, but each partner must contribute financially to the formation of her LLP. The amount of capital contributions is disclosed in the LLP agreement and the amount of stamp duty paid depends on the total amount of contributions.
What is the minimum number of partners required to form a limited partnership?
At least two persons are required to form a limited partnership. A limited partnership requires a minimum of two and a maximum of 200 named partners.