LLP defines Limited Liability partnership under the Limited Liability Partnership Act, 2008. LLP provides the platform to the business entity to establish their businesses in a simple and easier way while providing limited liability to the owners. The liability of each partner under the Limited Liability Partnership is limited. Limited Liability partnership also has the legal existence and identity which is different from that of its partners.
Limited liability partnership is an agreement i.e. it is a written agreement between the designated partners of the LLP or between the LLP only and the designated partners of the LLP. The LLP agreement defines the rights, power, duties, and liabilities of the designated partners of the LLP. It is mutual agreement between all the designated partners.
FEATURES OF LIMITED LIABILITY PARTNERSHIP
LLP defines or contains the features which define as under:
Separate Legal existence: It defines every LLP has its own asset and incur liabilities in its own name and sued or can be sued in their own names.
Limited Liability: Under LLP, liability of the designated partners is separate and limited. In the case if LLP is in the process of winding up and suffer any losses then the personal assets of the designated partners will not be liable for the same.
Profit Sharing: Under Limited Liability Partnership, designated partners of the LLP are free to decide their profit sharing ratio.
LLP partners: Designated partners under the LLP can be individual or even body corporate.
Minimum number of partners: Under LLP, minimum number of partners under LLP is two. The maximum number of designated partners is unlimited.
Perpetual Succession: It defines, partners may come or go, but the LLP remains forever.
ADVANTAGES OF LIMITED LIABILITY PARTNERSHIP
Some of the advantage of the LLP describe as below:
LLP is an organized form of the business entity which is based on the LLP agreement.
LLP also a flexible form of the organization without legal matter.
LLP is an innovation and efficient way of business organization.
BENEFITS OF LIMITED LIABILITY PARTNERSHIP
The LLP defines the benefits which are describes as below:
LLP is very easy to incorporate as company to company incorporation.
Like company, LLP also have the body corporate which means LLP also have the separate legal existence as compared to partnership.
Designated partners of the LLP can run their LLP in its own way as it is flexible to run on the basis of LLP agreement.
Transfer of the ownership under LLP is easier, any partner can transfer their ownership on the basis of LLP agreement.
Tax related matter under LLP at a lesser rate as compare to company.
Partners are not the managers or representative of the other partners under LLP.
Legal requirement, regulation and compliance less.
The cost of LLP incorporation is lesser as compared to company incorporation.
No minimum requirement of capital contribution.
STEPS TO INCORPORATE THE LLP
The process of the LLP incorporation
STEP 1: To file the LLP RUN for name confirmation, the partners have to file the LLP run for the name confirmation under MCA. Further the LLP name which will submit to the MCA should end with the word “LLP”.
STEP 2: After the Name confirmation, Digital signature Certification issue of the partners and the Fillip form will submit to the department for the LLP incorporation. Attachment of the Fillip.
Subscriber sheet and form 9 consent to act as a designated partner.
Utility Bill along with the NOC
Identity proof and address proof of the designated partners.
After the form is filed to the department the Certificate of Incorporation is generated by the MCA. After the certificate of Incorporation has been generated, PAN TAN application of the LLP will be submitted to the NSDL department for the issuance of PAN and TAN
STEP 3: LLP agreement will made between the partners
-The last step of the LLP Incorporation to prepare the LLP agreement between the designated partners in which all the rights, duties, power and liabilities of the designated partners will define.
-The LLP agreement will be stamped and notarized on stamp paper and should be signed by all the designated partners of the LLP in all the pages.
-The value of stamp paper is differ from state to state.
-LLP agreement will be submitting to the MCA within 30 days of the Certificate of Incorporation of the LLP issued by the department under FORM 3 to the ROC.
To form the LLP documents which are mandatory to submit to the department are describes as:
Pan Card of all designated partners.
VOTER ID/ Passport/ Driving License (any one) of all the designated partners for Identity Proof.
Latest bank statement/ Electricity Bill/ Telephone BILL (any one) of all the designated partners for address proof.
Latest Electricity Bill/ Gas bill/ Mobile BILL (any one) for the company registered address proof.
For digital signature certificate documents required are describes:
Pan card of all designated partners
Aadhar Card / Voter ID of all designated partners
Passport size photograph of all designated partners
Here to conclude LLP registration has become the important registration for the early entrepreneurs to enjoy the benefits of the government scheme and registration benefits. Choose NeuSource, your compliant partner. Team of efficient and skilled experts of NeuSource is always there for your help and guidance.
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