LLP is an organization which combines the advantages of both a company and a partnership firm. It gives the partners the freedom of a partnership firm as well as the limited liability feature of a company so that the fault of one partner need not be borne by others. LLPs are governed by Limited Liability Partnership Act,2008.
LLPs enjoy the status of separate legal identity hence making the partners and the business different persons.
All the LLPs are not required to get their books of accounts audited unless their turnover/capital exceeds a specified limit.
LLPs enjoy perpetual existence and thus exist irrespective of the status of the partners of the LLP.
Partners of LLP enjoy the limited liability feature of a company which enables the partners to free themselves from the faults committed by another partner.
Ownership of LLP can be easily transferred to others by making them designated partners.
LLPs cannot invite funds from public.
Procedure for incorporating LLP
Minimum of 2 persons are required to form an LLP. There is no limit on the maximum no. of partners an LLP can have.
Designated partner needs to be over 18 years of age. There is no restriction with respect to the nationality or citizenship.
There is no minimum amount of capital required to incorporate an LLP. A limited liability partnership can be started with any amount of capital.
No. One of the requisite of an LLP is to carry on business for profit.
Residence proof and ID proof are required for all the partners along with PAN card if the partner is an Indian national. No objection certificate along with ID and residence proof of the landlord of office premises is also required.
Filing of Income Tax Return, Service Tax/Sales Tax returns or both as may be. Payment of the above taxes and deduction of Income Tax at source may also be required in some cases.
If the LLP has a turnover of Rs.40 lakhs or more and/or has a capital contribution of Rs.25 lakhs or more, the financial statements should be audited.
Digital signature is process to authenticate and validate records electronically. DSC is required for every director of the company as the Ministry of Corporate Affairs (MCA) mandates digital signature of directors on some documents.
DIN is a unique identification number which is allotted to all the directors existing or proposed. DIN can be obtained by filing e-form DIN1 in MCA portal.
Yes. An existing partnership firm can be converted into a limited liability partnership by following procedure laid down.
LLP Registration with DSC,DIN,ROC,TAN, and professional fee for incorporation.
LLP Registration with DSC,DIN,ROC,TAN, and professional fee for incorporation with service tax registration.
LLP Registration with DSC,DIN,ROC,TAN, and professional fee for incorporation with service tax registration,MSME Registration.
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