Limited Liability Partnership

Last Updated at: June 30, 2020
559
Limited Liability Partnership
  1. What is LLP?

  2. Concepts of LLP

  3. Important facts about Limited Liability partnership

  4. Advantages of LLP form

  5. What is the procedure to register for an LLP in Vakilsearch?

  6. What is the flexible idea of an LLP company

  7. Documents required for LLP registration

What is an LLP?

The Limited Liability Partnership (LLP) is a recent corporate structure or format. It combines the quality of being flexible and the benefits of limited liability of the company. It can be at a low compliance cost. In LLP, the partnership has the right to hold the ownership and to hold the power to manage the LLP. Hence, the partners in LLP has the capability of being an owner and as well as a manager.

The limited liability partnership is very familiar and preferred by professionals like software firms, architects, accountants, chartered, designer, etc. They like to set up their business entity.  For starting an LLP, the directors or partners bring up with their minimum amount as the capital as their investment for starting an LLP.

Concepts of LLP

  1. LLP is an alternative corporate business form that gives the advantage of limited liability of a company and the flexibility of a partnership
  2. Moreover, it can also hold contracts and hold property in its own name. The LLP can continue its business irrespective of changes in partners.
  3. The legal entity is separate from the LLP. It is responsible for the full extent of its assets but the liability of the partners is related to their agreed contribution.
  4. Furthermore, one partner is not liable to another partner on account of independent or unauthorized actions. So, each partner has their own responsibilities and rules to be followed.
  5. The mutual rights and duties are governed by an agreement between the partners. Further, this agreement is between the partners and the LLP.
  6. Therefore, LLP is called a hybrid structure, since it has the combination of both a corporate structure and a partnership firm structure.

Your LLP Registration is easy now

Important facts about Limited Liability partnership

  • A limited liability partnership is like a combination of a partnership or a simple partnership firm and a private limited company. 
  • Additionally, this literally means while you have partners for sharing profits and losses in the equal subsistence. 
  • Further, the profit or loss can be done by sharing the ratio of the partnership or LLP. They have an agreement for all the causes of the partnership. They are also supported by limited liability. 
  • This means that, if they are not able to pay their debts of their LLP, their personal assets or property will not be affected.

Advantages of LLP form

  • LLP form is a form of business structure or model. It is organized and is operated on the bases of an agreement
  • It doesn’t need any detailed legal and procedural agreement since it is very flexible. 
  • Additionally, it enables professional expertise which combines the financial risk in an innovative way and in an efficient manner.

Advantages of Limited Liability Partnership

What is the procedure to register for an LLP in Vakilsearch?

  1. First, you need to apply for a Digital Signature Certificate for your limited liability partnership. This is nothing but an E-signature to help you complete your registration process online instantly.
  2. Additionally, for getting started with digital signature certification, it normally takes two business days after you submit your documents. 
  3. After the above step, next, we apply for a director application number or DAN number which normally takes one business day. 
  4. Now, the next step is choosing a good name for your Limited Liability Partnership. For instance, the LLP’s name does not have to be your brand name. You can choose whatever name you are familiar with. 
  5. Therefore, these processes are very simple and straightforward and you are almost certain to get your LLP name.

What is the flexible idea of an LLP company

Since LLP in India is a newly growing business, there is some flexibility in running a Limited Liability Partnership

Convenience

It is easy to start a business for entrepreneurs. Additionally, the agreements for LLP is very specific in accordance to meet the requirements of the directors or partners. 

Very less minimum capital requirements

An LLP can be started with a minimum amount of investment. Their capital amount can be in the form of 

Documents required for LLP registration

Documents required for Limited liability partnerships are for both the directors and for the office as follows

For the Directors

  • PAN card or passport for an identity proof
  • Voter’s ID, passport, or driver’s license for address proof
  • Latest bank statement, or Electricity bill or residence proof
  • Passport size photograph for each director
  • Specimen signature from the director

For the office

  • A proper notarized statement of the rental agreement
  • No Objection Certificate (NOC) from a property owner if it is a rented property
  • Sale deed or property deed in case of owned property

Once the documents are submitted properly, the registrar will prepare your memorandum and articles. Further, they will let you know about the registration fees and stamp duty details. You will further receive your company PAN and TAN Card.

 

0

Limited Liability Partnership

559
  1. What is LLP?

  2. Concepts of LLP

  3. Important facts about Limited Liability partnership

  4. Advantages of LLP form

  5. What is the procedure to register for an LLP in Vakilsearch?

  6. What is the flexible idea of an LLP company

  7. Documents required for LLP registration

What is an LLP?

The Limited Liability Partnership (LLP) is a recent corporate structure or format. It combines the quality of being flexible and the benefits of limited liability of the company. It can be at a low compliance cost. In LLP, the partnership has the right to hold the ownership and to hold the power to manage the LLP. Hence, the partners in LLP has the capability of being an owner and as well as a manager.

The limited liability partnership is very familiar and preferred by professionals like software firms, architects, accountants, chartered, designer, etc. They like to set up their business entity.  For starting an LLP, the directors or partners bring up with their minimum amount as the capital as their investment for starting an LLP.

Concepts of LLP

  1. LLP is an alternative corporate business form that gives the advantage of limited liability of a company and the flexibility of a partnership
  2. Moreover, it can also hold contracts and hold property in its own name. The LLP can continue its business irrespective of changes in partners.
  3. The legal entity is separate from the LLP. It is responsible for the full extent of its assets but the liability of the partners is related to their agreed contribution.
  4. Furthermore, one partner is not liable to another partner on account of independent or unauthorized actions. So, each partner has their own responsibilities and rules to be followed.
  5. The mutual rights and duties are governed by an agreement between the partners. Further, this agreement is between the partners and the LLP.
  6. Therefore, LLP is called a hybrid structure, since it has the combination of both a corporate structure and a partnership firm structure.

Your LLP Registration is easy now

Important facts about Limited Liability partnership

  • A limited liability partnership is like a combination of a partnership or a simple partnership firm and a private limited company. 
  • Additionally, this literally means while you have partners for sharing profits and losses in the equal subsistence. 
  • Further, the profit or loss can be done by sharing the ratio of the partnership or LLP. They have an agreement for all the causes of the partnership. They are also supported by limited liability. 
  • This means that, if they are not able to pay their debts of their LLP, their personal assets or property will not be affected.

Advantages of LLP form

  • LLP form is a form of business structure or model. It is organized and is operated on the bases of an agreement
  • It doesn’t need any detailed legal and procedural agreement since it is very flexible. 
  • Additionally, it enables professional expertise which combines the financial risk in an innovative way and in an efficient manner.

Advantages of Limited Liability Partnership

What is the procedure to register for an LLP in Vakilsearch?

  1. First, you need to apply for a Digital Signature Certificate for your limited liability partnership. This is nothing but an E-signature to help you complete your registration process online instantly.
  2. Additionally, for getting started with digital signature certification, it normally takes two business days after you submit your documents. 
  3. After the above step, next, we apply for a director application number or DAN number which normally takes one business day. 
  4. Now, the next step is choosing a good name for your Limited Liability Partnership. For instance, the LLP’s name does not have to be your brand name. You can choose whatever name you are familiar with. 
  5. Therefore, these processes are very simple and straightforward and you are almost certain to get your LLP name.

What is the flexible idea of an LLP company

Since LLP in India is a newly growing business, there is some flexibility in running a Limited Liability Partnership

Convenience

It is easy to start a business for entrepreneurs. Additionally, the agreements for LLP is very specific in accordance to meet the requirements of the directors or partners. 

Very less minimum capital requirements

An LLP can be started with a minimum amount of investment. Their capital amount can be in the form of 

Documents required for LLP registration

Documents required for Limited liability partnerships are for both the directors and for the office as follows

For the Directors

  • PAN card or passport for an identity proof
  • Voter’s ID, passport, or driver’s license for address proof
  • Latest bank statement, or Electricity bill or residence proof
  • Passport size photograph for each director
  • Specimen signature from the director

For the office

  • A proper notarized statement of the rental agreement
  • No Objection Certificate (NOC) from a property owner if it is a rented property
  • Sale deed or property deed in case of owned property

Once the documents are submitted properly, the registrar will prepare your memorandum and articles. Further, they will let you know about the registration fees and stamp duty details. You will further receive your company PAN and TAN Card.

 

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