Why Register an LLP Company?

With the completion of first step that is figuring out business model, the next step is to choose between a private limited company and an LLP company, keeping in mind the different advantages they offer.
There are large number of entrepreneurs that prefer to go for an LLP company over a private limited company because of the benefits it offers. Besides being extremely easy to set up it offers lower compliance burden in case of minimal activity. 

Listed below are few advantages that LLP provides:

  1. No requirement of compulsory audit:
    This feature of an LLP makes it suitable for small businesses. In case of LLP, there is no such mandatory requirement. This is perceived to be a significant compliance benefit. A Limited Liability Partnership is required to get the tax audit done only in the case that:-
    The contributions of the LLP exceeds Rs. 25 Lakhs, or The annual turnover of the LLP exceeds Rs. 40 Lakhs
  1. Lower registration cost:
    The cost of registering an LLP company is very low as compared to a private limited company, which makes it beneficial for small scale entrepreneurs to enter into an LLP.
  1. Tax benefit
    For income tax purpose an LLP is treated on a par with partnership firms. Therefore in an LLP share of its partners is not liable to tax.
  1. No limit on maximum number of partners
    An LLP requires a minimum of two partners while there is no limit on maximum number of partners. Transferring the ownership of an LLP is also easy. A person can quickly be assigned as designated partner and ownership can be quickly transferred.

Easy Steps to Register an LLP

At StartupGenie, we make it easy and simple for you to complete the registration process.
Once the LLP name is approved, you can register the LLP by filling the application form.

Step 1: Application for DIN or DPIN
All designated partners need to obtain “Designated Partner Identification Number (DPIN)”. You need to file eForm DIR-3 in order to obtain DIN or DPIN. In case you already have a DIN (Director Identification Number), the same can be used as a DPIN.

Step 2: Obtain DSC
Acquire DSC -A licensed Certifying Authority (CA) issues the digital signature. Certifying Authority (CA) means a person who has been granted a license to issue a digital signature certificate.

Step 3: New user registration
In order to get any paid service on portal regarding an LLP, you need to first register yourself as a user in the relevant category.

Step 4: Incorporate an LLP
Once the registrar approves your MOA and AOA, you’re steps closer to getting your LLP registered. The next step is to get the LLP Incorporation Certificate. You can do by submitting all documents to the registrar. The time frame is between 2- 12 days. 

Step 5: File an LLP agreement
After incorporation of LLP, an initial LLP agreement is to be filed within 30 days of incorporation of LLP. The user has to file the information in Form 3 online on MCA portal.  It determines the mutual rights and duties amongst the partners, and between the LLP and the partners.

Documents Required for Registering an LLP in India

To be submitted by partners:

  • Scanned copy of PAN card or passport
  • Scanned copy of Aadhar card/ voter ID/ driver’s license.
  • Scanned copy of latest bank statement 
  • Scanned copy of specimen signature of designated partners and passport sized photograph.
    { documents must be self attested by designated partners}

To be submitted to registrar:

  • Scanned copy of latest bank statement
  • Scanned copy of notarized rental agreement
  • Scanned copy of no- objection certificate
  • Scanned copy of property deed.

Check if your Firm Qualifies for LLP in India

  • At least two partners are required to form an LLP. There is no limit to the maximum number of partners. The nomination of a natural person, if a body corporate is a Partner
  • No shared capital requirement, though each partner must have an agreed contribution towards it.
  • Minimum capital contribution: There is no minimum capital requirement for an LLP (or a company, for that matter). The LLP should have an authorized capital of at least Rs. 1 lakh.
  • At least one Designated Partner as an Indian resident
  • DPIN for all Partners
  • DSC for all the Designated Partners
  • Address proof for the office of LLP. The registered office of an LLP does not have to be a commercial space. Even a rented home can be the registered office, so long as an NoC is obtained from the landlord.
  • With regard to the changes in the FDI regulations dated November 10, 2015, foreign investors are now permitted to have a 100% FDI in the automatic route LLP. The 100% FDI in the LLP is granted to foreign companies who operate in activities or sectors where 100% FDI is considered permissible through the channels of the automatic route.

Check LLP Name Availability

Limited Liability Partnership-Reserve Unique Name is filed for the reservation of name of proposed LLP which shall be processed by the Central Registration Centre. But before quoting the name in the form, it is recommended that you use the free name search facility on MCA portal. The system will provide the list of closely resembling names of existing companies/LLPs based on the search criteria filled up. This will help you in choosing names not similar to already existing names. The registrar will approve the name only if the name is not undesirable in the opinion of the Central Government. 

Factors to consider while selecting a name for LLP:

  • It must have a unique component, that is not used before
  • Keep in mind the abbreviations, adjectives and generic words that are blacklisted.
  • There should not be a registered trademark by the same name

FAQ’s

I am an NRI. Can I start an LLP business in India?

Yes, non-resident Indians and foreign nationals who are willing to enter into an LLP partnership can do so, provided they submit the necessary documents after getting it notarized by the concerned authorities. Although, at least one of the designated partners in an LLP should be an Indian.

What is an LLP agreement?

An LLP agreement is one that is made between the partners and the LLP regarding the relationship between the individual partners in the LLP. An LLP agreement usually consists of management policies, inclusion of new partners, policy making strategies, and so on.

How can I view list of Companies/LLPs registered in last 30 days?

To search for Indian and foreign Companies/LLP’s registered in last 30 days, follow the steps given below: 

  • Login to the MCA21 application.
  • Click the MCA Services tab. The list of MCA Services is displayed.
  • Under the Master Data Services, click the Companies/LLPs registered in last 30 days. 
  • The system will generate an excel detailing down the list of all Indian and Foreign Companies and LLP’s registered in last 30 days

What is the eligibility of designated partners/partners in an LLP?

Any individual, or even a company or an LLP, can become a partner. However, only an individual can become a ‘designated partner’ in an LLP.

Is it cheaper to run an LLP than a private limited company?

Yes, it is comparatively cheaper to run an LLP than a private limited company, particularly in your early start-up days. This is because many compliances, such as an audit, apply to LLPs only after their turnover is sizeable.