What you should know about LLP Registration
What is Limited Liability Partnership?
LLP is the latest form of business where the features of a partnership are combined with the features of a company.
It is a partnership where all the partner’s have limited and disjoint liability, i.e. the personal assets of the partners cannot be utilized to pay off firm’s liabilities and individual partners have no joint liability created by another partner’s wrongful business decisions or carelessness.
Since, LLP contains elements of both a company and a partnership it is better known as a hybrid between a company and a partnership.
What is LLP Registration ?
LLP refers to Limited liability partnership and is governed by Limited Liability Partnership Act 2008. Limited Liability partnership provides advantage of limited liability to its owners and at the same time requires minimal maintenance. The directors of a private limited company have limited liability to creditors. In case of default, banks / creditors can only sell company’s assets and not personal assets of directors.
LLP Registration can be done through LegalRaasta in Delhi NCR, Mumbai, Bengaluru, Chennai and all other Indian cities.
Choose LLP because
Dual advantages- Company and a Partnership
No partner will be responsible for other partner’s misconduct
Cheaper to incorporate than a private limited company
Limits the liabilities of its partners
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Steps Involved in LLP RegistrationApplication of DSC & DPIN : Our very first step in this direction would be getting Digital Signature Certificate (DSC) and Designated Partner Identification Number (DPIN) for the proposed Partners of the LLP. Within a timeframe of 5 to 7 working days DPIN and DSC can be obtained for the proposed Partners. If the partners already have DSC and DPIN, then this step can be skipped.Name approval :A minimum of one and a maximum of six proposed names are required to be given to the MCA. Subject to availability, naming guidelines and MCA processing time, we will get back to you with the Name approval within 5 to 7 working days. Names provided should ideally be unique and suggestive of company business.MOA & AOA submission :Once name is approved, one needs to draft Memorandum of association and Articles of Associate. Both MOA and AOA are filed with the MCA with the subscription statement.Get incorporation certificate :Incorporation documents can be submitted to the MCA along with an application for incorporation. MCA will usually approve the application for incorporation in 5 to 7 days, subject to their processing time. Incorporation certification is a proof that company has been creation. It also includes your CIN number.Apply for PAN, TAN and Bank account :Then you need to apply for PANand TAN. PAN and TAN are received in 7 working days. Post this, you can submit the Incorporation certificate, MOA, AOA and PAN with bank to open your bank account.
Advantages of LLPSeparate Legal EntityA LLP is a legal entity and a juristic person established under the Act. The partners are distinct from the entity and both can sue each other and get sued in the process.Uninterrupted ExistenceA LLP has ‘perpetual succession’, that is continued existence until it is brought on the terms of the dissolution by mutual agreement within the partners. Partners may come and go, but an LLP goes on.Audit not RequiredEntrepreneurs earning a turnover of less than 40 Lakhs and capital contribution of less than 25 Lakh need not get their accounts audited .Therefore, LLPs are ideal for startups and small businesses that are just starting their operations and want to have minimal regulatory compliance related formalities.Easy TransferabilityThe ownership of a LLP can be easily transferred to another person. All you need is to induct them as a Designated Partner of the LLP. LLP is a separate legal entity separate from its Managing Partners, so by changing the Managing Partners, the ownership of the LLP can be changed.Owning PropertyAn LLP being a juristic person, can acquire, own and enjoy property in its own name. And this is entirely distinct from its partners. No Partner can make any claim upon the property of the LLP so long as the LLP is a going concern.Limited LiabilityThe biggest advantage is Limited Liability, which means the status of being legally responsible only to a limited amount for debts of a LLP. Unlike proprietorships and partnerships, in a LLP the liability of the members in respect of the LLP’s debts is limited. The personal assets of the directors are safe if the company goes bankrupt.So it’s entirely a win –win situation for you if you plan to step to head forward with a suffix LLP.
Registerllp.com is an online portal to help companies register LLP in India. We have 7+ years of experience in application of LLP. We have helped more than 450+ clients for LLP registration. Register LLP is an initiative by LegalRaasta - India's topmost CA,CS & Legal platform.