Corporate Laws (Amendment) Bill 2026: Key Proposed Changes for LLPs in India

The Corporate Laws (Amendment) Bill, 2026 proposes several changes to the Limited Liability Partnership (LLP) Act, 2008, to improve ease of doing business and provide greater flexibility to LLP structures in India. Key proposals include a framework for specified trusts to convert into LLPs, special provisions for International Financial Services Centre (IFSC) LLPs, changes to professional declarations during LLP incorporation, and decriminalisation of certain LLP-related offences by replacing criminal consequences with civil penalties.

As of 2 November 2026, the Bill remains pending before Parliament. The Joint Parliamentary Committee submitted its report on 3 August 2026, but the proposed changes should not be presented as provisions already in force. Existing LLP Act requirements continue to apply until the relevant amendments are enacted and brought into effect.

Talk to our experts if you are weighing a structure decision against this Bill.

Where the Bill Stands

Date	Event
23 March 2026	Introduced in the Lok Sabha and referred to a Joint Parliamentary Committee
24 March 2026	Rajya Sabha concurs in the reference to the Joint Committee
31 July 2026	Joint Committee adopts its report
3 August 2026	Report presented to Lok Sabha and laid in Rajya Sabha, endorsing the Bill with modifications
2 November 2026	PRS tracker shows no passage recorded; the Bill is not yet law
After enactment	Provisions take effect on dates notified by the Central Government, and different provisions can start on different dates

The Bill has 107 clauses across the Companies Act and the LLP Act. The final text may differ from the version introduced, so confirm the current status before relying on any of this.

What the Bill Proposes for LLPs

1. A framework for IFSC LLPs

A new “Specified IFSC LLP” is an LLP set up in an International Financial Services Centre and regulated by the IFSC Authority.

• It must keep its registered office in the IFSC at all times.
• Its name must carry the suffix “International Financial Services Centre LLP”. The JPC recommended allowing the shorter “IFSC LLP” as an alternative.
• Its objects must be financial services activities permitted under the IFSCA Act, 2019.
• Partner contributions must be accounted for and disclosed in a permitted foreign currency. Existing IFSC LLPs get a transition period to convert from rupees and cannot accept rupee contributions after commencement without converting.
• Fees, fines, and penalties are reported to stay payable in rupees. Confirm this in the final text.

2. Conversion of trusts into LLPs

The Bill allows specified trusts to convert into LLPs. The trust must be set up under the Indian Trusts Act, 1882 or another central or state law, be registered with SEBI or the IFSC Authority, and be engaged in prescribed activities. This mainly covers trust-based Alternative Investment Funds (AIFs).

• The partners of the converted LLP must be the trustees.
• The Bill requires investor consent of at least 75%. The JPC backed stronger safeguards: value-based investor approval and regulatory clearance before conversion.
• All assets and liabilities of the trust transfer to the LLP, and the trust is dissolved.
• Trustees continue to bear personal liability, along with the LLP, for liabilities incurred before the conversion.
• The Ministry has said the tax consequences will be governed by tax laws, not by this Bill.

3. Annual filing for regulated LLPs

At present, every LLP must file changes in the LLP agreement and changes in partners within 30 days. For prescribed classes of LLPs regulated by SEBI or the IFSC Authority, such as AIFs, the Bill provides for filing these changes annually. The JPC recommended stating the annual basis in the law itself.

• This is a concession for funds. AIF partners join and exit almost every month, which is why the 30-day rule was a barrier.
• Changes in designated partners must still be filed within 30 days.
• The JPC also recommended exempting these classes from public inspection of their documents, to protect investor information.

4. Registered valuers for LLPs

A new Section 33A would apply the Companies Act’s registered-valuer system to LLPs. A registered valuer would be needed for valuing a partner’s contribution, an LLP’s property or assets, its net worth, or its liabilities. The Bill also makes the Insolvency and Bankruptcy Board of India (IBBI) the valuation authority.

5. Optional professional certification at incorporation

This is the one proposal that reaches ordinary LLPs directly. Today, an advocate, CA, CS, or cost accountant must certify that the incorporation requirements have been met. Under the Bill, a declaration by one of these professionals is required only where the LLP has engaged one. A statement by a subscriber to the incorporation document remains mandatory. The Ministry has said the rules and forms will be amended once the Bill is passed.

6. Decriminalisation

The Bill replaces criminal penalties with civil penalties for several procedural defaults under the Companies Act and the LLP Act. Check the final list of offences once the Bill is passed.

7. Useful additions recommended by the JPC

The JPC recommended new LLP Act sections that would help ordinary LLPs, if accepted:

• Section 69A: refund of fees where a form could not be filed because of technical reasons.
• Section 69B: a procedure to rectify clerical or factual errors in documents filed with the Registrar.
• Section 69C: application of the Digital Personal Data Protection Act, 2023 to filed records.

What It Doesn’t Touch

The clauses reviewed and PRS’s summary do not indicate any changes to these LLP requirements:

• Annual Return (Form 11) and Statement of Account and Solvency (Form 8) filings.
• The audit thresholds, which apply when turnover exceeds ₹40 lakh or contribution exceeds ₹25 lakh.
• The minimum requirement of two designated partners, one of them resident in India.
• The 30-day filing deadlines for ordinary LLPs.

Some commentary refers to broader compliance relief for small LLPs. This isn’t reflected in the clauses reviewed, so treat any such relief as unconfirmed until the final legislative text is published. See LLP compliance calendar for current due dates.

The Company-Side Change That Matters to LLP Owners

The Bill raises the Act’s upper limits for a small company to ₹20 crore of paid-up capital and ₹200 crore of turnover, from ₹10 crore and ₹100 crore. Note the difference between the law and the rules. The actual limits are set by rules, and MCA already raised them to ₹10 crore and ₹100 crore on 1 December 2025 (G.S.R. 880(E)). Doubling them in practice would need a further rule change after the Bill passes.

The Bill also proposes:

• Virtual or hybrid general meetings, with a physical meeting at least once every three years.
• A higher CSR net-profit threshold of ₹10 crore, up from ₹5 crore.
• An exemption from appointing an auditor for prescribed classes of companies. The JPC recommended limiting it to private companies.
• Ease of compliance for One Person Companies, small companies, and startups.
• Decriminalisation of several procedural defaults.

Together, these make a private company lighter to run, which narrows the compliance gap that pushes small firms toward an LLP.

Aspect	Today	If the Bill passes as introduced
Small company limits (prescribed)	₹10 crore capital, ₹100 crore turnover, since 1 December 2025	Act ceiling raised to ₹20 crore and ₹200 crore; actual limits need new rules
General meetings	Physical AGMs the norm	Virtual or hybrid allowed, with a physical meeting at least once every three years
Auditor appointment	Required	Prescribed classes may be exempt (the JPC would limit this to private companies)
CSR net-profit threshold	₹5 crore	₹10 crore
Ordinary LLP filings	Annual return and solvency statement	No change in the clauses reviewed
Regulated LLPs and AIFs	30-day change filings	Annual change filings for prescribed classes

If you run a One Person Company, see annual compliance for One Person Company for what applies now.

Who Should Pay Attention Now

• Fund managers and AIFs structured as trusts or LLPs.
• Entities setting up in an IFSC, such as GIFT City.
• Founders choosing between an LLP and a private company who expect lighter company compliance. Compare LLP registration with private limited company registration.
• Valuers and advisers who handle partner contributions and LLP valuations.
• Professionals planning to form an LLP, who may find incorporation lighter once the rules change. See LLP for consultants and professionals.

What To Do in the Meantime

Step 1. Keep every current deadline: File your existing LLP forms on the existing dates. A pending bill doesn’t extend or relax anything. See how to file LLP Form 11.

Step 2. Check whether you’re in the affected group: If you are not regulated by SEBI or the IFSC Authority and not a fund, most of the LLP provisions won’t reach you.

Step 3. Hold off on structure changes: Converting an LLP to a company, or the reverse, on the strength of a proposal is premature. If you’re converting a partnership to an LLP for other reasons, see conversion of partnership firm to LLP.

Step 4. Track the notification: Watch the MCA and Parliament updates, since different provisions can start on different dates.

Step 5. Revisit your structure after enactment: Once the final text is out, rerun the LLP-versus-company comparison on actual numbers.

Want us to monitor this for your LLP? Speak to our experts today.

Penalty and Consequences

No new penalty applies to any LLP today, because nothing has been notified. The real risk is misreading a proposal as law. An LLP that skips or delays a current filing because it expects a relaxation still faces the usual ₹100 a day late fee, with no cap.

Common Mistakes

• Treating the Bill as if it were already in force.
• Assuming the annual-filing relief applies to every LLP, when it’s limited to prescribed regulated classes.
• Converting from an LLP to a company in anticipation of a rule that may change.
• Assuming the small-company limits have already doubled to ₹20 crore and ₹200 crore, when only the Act’s ceiling would change.
• Repeating claims about small-LLP relief that the clauses reviewed don’t support.

Why Staying Measured Pays Off

• You avoid missed deadlines driven by headlines.
• You make structure decisions on final law, not drafts.
• You are ready to use any genuine relief once it’s notified.

A Scenario Worth Knowing About

A three-partner consulting LLP reads that “LLP filings are being relaxed to annual” and decides to hold back its annual return until the rules are clear. But the proposed relaxation covers partner and agreement changes for certain SEBI or IFSC-regulated LLPs. It has nothing to do with the annual return of an ordinary consulting LLP. The return goes in weeks late, and the firm pays ₹100 a day for the delay.

Expert Tips

• Read who a proposed relief applies to before assuming it applies to you.
• Follow the final notified text, not summaries or social posts.
• Keep your own compliance calendar independent of any pending legislation.

How Kanakkupillai Can Help

We track the Bill’s progress, tell you plainly whether any provision reaches your LLP, keep your current filings on schedule, and rerun the LLP-versus-company decision once the final law is notified.

Conclusion

For most LLPs, this Bill is a watch-and-wait story. Its LLP provisions are aimed mainly at funds and IFSC entities, and its most consequential change for everyday founders sits on the company side. Keep filing on the current dates, don’t restructure on a draft, and revisit your structure once the final text is notified.

Get expert guidance on how the Corporate Laws Amendment Bill affects your LLP from Kanakkupillai today.

FAQs

1. Has the Corporate Laws (Amendment) Bill, 2026 become a law?

No. It was introduced in the Lok Sabha on 23 March 2026, and the Joint Parliamentary Committee presented its report on 3 August 2026. As of 2 November 2026, no passage has been recorded. It becomes applicable only after Parliament passes it and the Centre notifies the provisions.

2. Will the compliance of my small consultancy LLP be affected?

Not in the clauses reviewed. Annual filings, audit thresholds, partner requirements, and 30-day deadlines for ordinary LLPs are unchanged. One proposal, optional professional certification at incorporation, would affect new LLPs.

3. Who will be eligible for the annual filing relaxation?

Prescribed classes of LLPs regulated by SEBI or the IFSC Authority, such as AIFs incorporated as LLPs. They would file changes in the agreement and in partners annually instead of within 30 days. Changes in designated partners must still be filed within 30 days.

4. Can a trust be converted into an LLP under the Bill?

Yes, for specified trusts registered with SEBI or the IFSC Authority, including AIFs. The partners must be the trustees, investors must approve the conversion, and trustees keep personal liability for pre-conversion liabilities. The JPC backed value-based investor approval and regulatory clearance.

5. Should I convert my LLP into a company because of this Bill?

Not now. A lighter small-company regime might make companies easier to manage, but it isn’t law yet, and the actual limits depend on rules. Reassess the comparison once the final law is notified.

6. When will the new amendments come into force?

On dates notified by the Central Government after passage. Different provisions may come into force on different dates.

7. Does the Bill change the LLP audit thresholds?

Not in the clauses reviewed. An LLP is audited when its turnover exceeds ₹40 lakh or its contribution exceeds ₹25 lakh, as at present.

8. What is an IFSC LLP?

It is an LLP set up in an International Financial Services Centre, such as GIFT City, and regulated by the IFSC Authority. It must keep its registered office in the IFSC and account for partner contributions in a permitted foreign currency.

9. Do I need a professional to incorporate an LLP after the Bill?

Not necessarily. A declaration by a practising professional would be required only if you engage one. The subscriber’s statement would still be mandatory. The forms will change once the rules are notified.