LLP Registration In Pune : In Detail Guide
What is a limited liability partnership (LLP)?
Creating an LLP is a good way to protect your personal assets from your company’s liabilities, offering protection for your personal assets in the event of a failure. For this reason, forming an LLP is a much secure solution for many small owners than a sole proprietorship or a general partnership.
A limited liability partnership or LLP is similar to a limited company in that it offers limited liability to its members and therefore protects their personal assets. There are, however, three significant differences:
- A limited liability partnership is taxed as a partnership and is not subject to corporate dividend distribution tax.
- There are no directors or shareholders in an LLP instead, it has partners and designated partners.
- An LLP is governed by the Limited Liability Partnerships Act 2000 and not the Companies Act of 2013.
Who would use an LLP?
LLPs are becoming increasingly popular as they offer the limited liability of a limited company and the flexibility of a partnership. They are most commonly used by certain professionals that typically form a partnership – doctors, architects, lawyers – but whose members wish to limit their personal liability.
Key features and benefits
- Profits are split amongst the members.
- An LLP is not subject to corporate tax, income tax or capital gains tax. Instead, the individual members are taxed on profits.
- Another company can be a member of an LLP
What are the advantages of forming a limited liability partnership?
Forming a limited liability partnership (LLP) provides benefits and liability protection for any type of business.
The main benefits of forming an LLP Include:
- Protect your personal assets with liability protection
- Save money on taxes
- Establish credibility with customers
- Less paperwork and secretarial compliance
- Audit is not mandatory in all cases.
- Minimum suggested capital contribution is Rs 50,000.
- Low formation costs
What are the minimum requirements for a limited liability partnership?
- Minimum 2 Designated Partners
- At least 1 of the designated partners shall be an Indian Resident
- The Partners and Designated Partners can be the same person
- There is no concept of share capital, but there has to be some sort of contribution from each partner
- DSC (Digital Signature Certificate) for any one of the Designated Partners
- DIN (Director Identification Number) for all the Designated Partners
What are the legal requirements of an LLP?
- An LLP must have a minimum of two designated partners
- It must register with the Registrar of Companies
Frequently asked questions
There are many questions in the mind when one is supposed to start a business, we’ve answered them all.
1) How many people are required to form an LLP?
Minimum of two designated are required to form an LLP. There is no maximum number of members for an LLP.
2) Who can be a designated partner?
The partner needs to be over 18 years of age.
5) How long does it take to form an LLP?
Our core mission is to incorporate an LLP at the earliest. However due to the procedure being approval based, the formation should be done in 10 – 21 days.
6) How and when do I receive my new company documents?
As soon as Registrar of Companies approves your LLP registration you will receive electronic copies of your Certificate of Incorporation and LLP agreement. Printed and bound copies of these documents will be posted to you within 3 working days.
7) What happens if my application is rejected by Registrar of Companies?
Occasionally this may happen and it is typically due to an unsuitable company name or incomplete information on your application. Don’t worry, these issues can be easily resolved and you will be given the opportunity to re-submit your online application with the correct details or upload supporting documents and evidence.
8) Do I need a registered office address?
All LLPs are legally required to have a registered office address. All statutory mail will be sent here and the address details will be displayed on public record.
9) What are the documents required for incorporation?
In case of Indian National
- Identity Proof: Copy of PAN Card
- Address Proof: Copy of Any two of the following documents, Passport/Election/Voter ID/Ration Card /Driving license
- Passport Size Photograph
In case of Foreign National
- Identity Proof: Copy of Passport
- Address Proof:
- Passport Size Photograph