Limited Liability Partnership or LLP is a corporate business vehicle in India that enables professional expertise and entrepreneurial initiative
to combine and operate in flexible, innovative and efficient manner, as a hybrid of companies & partnerships providing benefits of limited liability
while allowing its members the flexibility for organizing their internal structure as a partnership through execution of LLP Agreement.
Limited Liability Partnership= advantages of Partnership + advantages of Company
All Limited Liability Partnerships incorporated in India is covered under Limited Liability Partnership Act, 2008 and Ministry of Corporate Affairs, power delegated to Registrar of Companies, is regulatory authority of all LLPs incorporated in India . It is preferred form of business among professional and various small and medium size entrepreneurs due to its many advantages as under:
Liability of all Partners is limited in LLP. None partners will incur personal liability in case of act of LLP or any other partner.
Partners can start their LLP with minimum capital as no minimum capital criteria is required by law.
All companies , whether private or public, irrespective of their share capital, are
required to get their accounts audited. But in case of LLP, there is no such mandatory requirement. A limited liability partnership is required to get the audit done only if:
• the contributions of the LLP exceeds ₹ 25 lakhs or
• the annual turnover of the LLP exceeds ₹ 40 lakhs
Like a Company, LLP also has Separate Legal Entity. So the Partners and the LLP in are distinct from each other.
As small and medium entrepreneurs , costing of organization is big concern. Due to audit requirement and other less legal requirement, its cost efficient.
In case of LLP , there is no maximum limit to have Partners .
Managing LLP is much flexible than Company.
Minimum two partners is necessary for LLP registration.
All Partners must have DPIN i.e. (Designated Partner’s Identification Number)
Minimum one partner must be a Indian Resident.
All Partners must have digital signature.
Address Proof for the registered office
Proposed Name of LLP must not be similar or identical to any other Company or LLP.
Object/business to be conducted in proposed LLP must be Legal.
Minimum capital contribution to be contributed by Partners.
Address of registered office of LLP.
Passport-sized photograph of all Partners/Designated Partners.
a copy of the aadhaar card of all the partners/Designated Partners.
Any on Proof of Identity like Voter ID/Driving Licencense/Passport of all Partners/Designated Partners
Any one Latest Bank Statement / Electricity bill/Telephone or Mobile Bill of all Partners (Not older than two months)
Valid mobile number of all Partners/Designated Partners.
Valid Email-id of all Partners /Designated Partners.
For registered office (i) address proof, electricity bill or any utility bill (not older than 2 months) (ii) duly signed NOC from Owner and (iii) If Rented, Duly notarized rent agreement along with one month receipt.
Every LLP is required to comply with the annual compliance requirements. These compliances are mandatory for all LLPs whether they have started their business or not.Following returns are required to be filed:
Annual Return is required to be filed with the Registrar of companies in LLP Form-11. The due date for this return is set on 30th May of each year i.e. within 60 days from the closing of every financial year.
After LLP registration, every LLP is required to submit their income tax return by 30th September every year.
Statement of Account & Solvency is required to be filed in LLP Form 8. This return is required to be filed by 30th October of each financial year.
According to Limited liability partnership Act 2008, it is mandatory to file all the prescribed compliance annually. There is a provision for penalty in case of any failure in filing Form 8 and Form 11 for reporting LLP’s financial statements and annual return.