Limited Liability Partnership

What is Limited Liability partnership?

Limited Liability Partnership (LLP), introduced only in 2008, has quickly become a popular legal structure for businesses. Its main improvement over the General Partnership is that, as the name indicates, it limits the liabilities of its partners to their contributions to the business and also offers each partner protection from the negligence, misdeeds or incompetence of the other partners.


Advantages of Limited liability partnerships:

  • Limited Liability

    Businesses often need to borrow money. In a General Partnership, partners are personally liable for all this debt. So if it cannot be repaid by the business, the partners would have to sell their personal possessions to do so. In an LLP, only the amount invested in starting the business would be lost; all personal property would be safe.

  • Reduced Compliance

    An LLP only requires audited annual returns to be filed if it has a turnover of greater than Rs. 40 lakh or capital contribution of over Rs. 25 lakh. It also needs to communicate fewer business transactions and structural changes than a private limited company.

  • Tax Advantages

    There are some important advantages over the private limited company. For example, Dividend Distribution Tax and tax surcharge don't apply. Loans to partners are also not taxable as income.

Documents Required for LLP Registration

TO BE SUBMITTED BY PARTNERS

  1. Scanned copy of PAN Card or Passport (Foreign Nationals & NRIs)
  2. Scanned copy of Voter's ID/Passport/Driver's License/Aadhar
  3. Scanned copy of Latest Bank Statement/Telephone or Mobile, Electricity or Gas Bill
  4. Scanned passport-sized photograph
  5. Specimen signature (blank document with signature [directors only])

FOR THE REGISTRED OFFICE

  1. Scanned copy of Latest Bank Statement/Telephone or Mobile, Electricity or Gas Bill
  2. Scanned copy of Notarized Rental Agreement in English
  3. Scanned copy of No-objection Certificate from property owner
  4. Scanned copy of Sale Deed/Property Deed in English (in case of owned property)