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Tax Online CA
An Overview

Limited Liability Partnership Registration

A Limited Liability Partnership (LLP) is a legal entity that combines the features of a traditional partnership and a private limited company. It offers limited liability protection to its partners while allowing them to have flexible management and operational structures. LLPs are governed by the Limited Liability Partnership Act, 2008, in India.

A Limited Liability Partnership is a distinct legal entity that provides its partners with limited liability protection. This business structure is widely favored due to its flexibility and ease of operation. In an LLP, partners have the freedom to manage the business collectively while enjoying limited personal liability for the company’s debts and obligations.

Required Documents for LLP Registration

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LLP vs Company

Difference Between LLP & Company for Startups

Aspect LLP Company
Number of Partners 2 to many, no maximum limit Restricted to 200 members
Audit Requirement Not required unless specific criteria are met Mandatory for all types of companies
Compliance Burden Less; only two statements required (Annual Return & Statement of Accounts and Solvency) More; around 8 to 10 regulatory formalities and compliances
Taxation LLP itself is not taxed; partners taxed individually Company taxed; dividend distribution tax applicable
Limited Liability Partners have limited liability Shareholders' liability may be limited by shares
Restructuring Easily amended through LLP Agreement Process may be more complex
Formation Ease Relatively easy and less time-consuming More complex process
Perpetual Succession Existence independent of partner changes Continuity may be affected by shareholder changes
Compliance Fewer compliance requirements More compliance requirements

LLP Registration Process

Step Description
Step 1: Documents & Information For LLP Registration LLP registration procedure starts with documentation of the proposed designated partners/partners and relating to the registered address of the LLP. Ensure that the documents are updated and correct. The mandatory information and documents for LLP Incorporation to be provided to us in the online questionnaire.
Step 2: Selection of Name for LLP The Name of the LLP should be cross-checked with the ROC and the trademark registry to avoid any infringement of someone else Trademark or Other Company /LLP Name. Check Name Availability or contact us.
Step 3: Making of Partners DSC DSC is equivalent to the physical or paper signature under the information technology act. For LLP registration, all the applications to ROC are filed in digital format signed by designated partners of the LLP. The filing process starts with the issue of a digital signature for all the partners of the LLP.
Step 4: Name Approval for LLP Registration The application for the Name approval of LLP is submitted in FormForm RUN-LLP. It is a web-based application, where two names in order of preference can be filed with a note on the significance of the Name and the business activities.
Step 5: ROC Filing for LLP Incorporation The application of New LLP Registration is filed in FILIP Form immediately after name approval. The partners KYC documents and proof of the registered address are submitted along with the application form. The Form, FILIP, is attested by a practising Chartered Accountant, Company Secretary, Cost Accountant, or an Advocate practising at High Court. The government filing fee for the registration of depends on the proposed capital/contribution of the LLP.
Step 6: Issue of the Certificate of Incorporation of LLP The LLP registration’s final stage is the Certificate of Incorporation for the LLP after the verification of the application for LLP Registration is filed in Form FILIP. The issuance of the registration certificate of LLP is conclusive proof of the LLP registration by ROC.
Step 7: Drafting of LLP Agreement and Filing to ROC Post-registration of the LLP, the partners need to enter into a valid agreement on stamp paper of appropriate value as per respective state. The LLP agreement defines the mutual rights and duties of the partners, and the LLP Agreement should be signed before a notary public. The duly signed & Notary Attested LLP Agreement is then filed with ROC in Form -3 within 30 days of the LLP Incorporation.
Step 8: PAN Card & TAN Number for the LLP The LLP needs to apply in the prescribed Form 49A to the income tax department for the allotment of PAN; the acknowledgement of the pan application for the LLP is received on the same day. However, the pan is allotted within a week. TAN number is a permanent number assigned to business for complying with withholding tax provisions (TDS). You are required to deduct TDS while making payments; hence, the next step is to obtain a TAN number, which is mandatory to submit TDS Returns.