Limited Liability Partnership (LLP)
LLP is an alternative corporate business form that gives the benefits of limited liability of a company and the flexibility of a partnership. The LLP can continue its existence irrespective of changes in partners. It is capable of entering into contracts and holding property in its own name. Since LLP contains elements of both ‘a corporate structure’ as well as ‘a partnership firm structure’ LLP is called a hybrid between a company and a partnership.
What are the minimum requirements for getting registered as a LLP?
- Minimum 2 Designated Partners
- DSC for each Designated Partner
- DPIN for each Designated Partner
- Place of Registered Office (Residential Address may also be used as Registered office)
- KYC documents of partners
What will be included in the said Package?
- Personal Consultation
- DSC of Two Designated Partner
- DPIN for 2 Designated partner
- Name search and application for reservation of name
- Applying for the Incorporation with the Ministry of Corporate Affairs.
- Obtaining Certificate of Incorporation.
- Submission of LLP agreement with the Ministry of Corporate Affairs
What is the basic difference between a Limited Liability Partnership and a General Partnership?
In case of LLP any debts and obligations of the LLP will be borne by the assets of the LLP
Can an existing partnership firm/company be converted to LLP?
Yes, an existing partnership firm/company can be converted into LLP
Can a listed company be converted to LLP?
No, only private / unlisted public company can be converted into LLP.
Who can be a “Designated Partner”?
Every LLP shall be required to have at least two Designated Partners who shall be individuals and at least one of the Designated Partner shall be a resident of India.
Whether audit of all LLPs would be mandatory?
Every LLP in India, whose annual turnover exceeds the magnitude of Rs. 40 Lakhs or the total contribution of its partners gets above the limit of Rs. 25 Lakhs, is mandatorily need to get its accounts audited every financial year
What are the benefits of a limited liability partnership?
A limited liability partnership has the following benefits:
• The nature of a limited liability partnership firm is that of a body corporate.
• It has a legal entity separate from its partners.
• It has perpetual succession
• Any change in the partners of a limited liability partnership shall not affect
the existence, rights or liabilities of the limited liability partnership
Thus, forming a limited liability partnership firm is more favourable.
Can a Company/LLP be a partner to a limited liability partnership?
Yes, company/LLP incorporated in India or outside India be a partner to a LLP
Whether Hindu Undivided Family (HUF) / its Karta can become partner / designated Partner in Limited Liability Partnership (LLP)?
HUF cannot be treated as a body corporate for the purposes of LLP Act, 2008. Therefore, a HUF or its Karta cannot become a partner or designated partner in LLP.