LLP Registration in India: A Simple 5 Step Guide to Help You Register Your LLP

What is LLP? 

LLP registration is known for its simplicity in compliance. Although it can take up a lot of time.

A Limited Liability Partnership, commonly recognized as an LLP, is a separate corporate business entity that resembles Partnership firms and Companies. The visible resemblance is a result of putting together the best features of a firm and a company. This form of entity was introduced in the LLP Act, 2008. 

Today, LLP has gained wide recognition. Its low compliance and minimal maintenance costs make LLP the best type of entity to establish and grow a business. LLP is popular for various reasons. One very important feature of the LLP is its Separate Legal Existence. The LLP is distant from its partners and that is why it can enter into contracts in its name. The LLP can sue and be sued.

The partners of the LLP are saved from unlimited liability as they hold merely the shares in the LLP. Partners are responsible for paying liabilities limited to their contributions by them. The excess is paid by the LLP itself. LLP registration in India is a simple task that does not require a lot of compliance and costs. Read below to learn how you gain registration for your LLP. 

Difference between an LLP and a Partnership

An LLP resembles closely to a partnership firm. Both entities are governed by different acts. Let us understand the key differences between an LLP and a partnership before observing the process of incorporating an LLP. 

1. Registering the entity: 

A partnership firm can be registered after the creation of the partnership deed. The partners will have to submit their Partnership Firm registration form and other subsequent forms to the Registrar of the Firms. 

Registration of LLP is granted by the Registrar of Companies. The LLP has to file various e-forms to start the LLP registration process in India. 

2. Mandatory Registration:

LLP registration is mandatory in India. Registering Partnership firms is voluntary.

3. Creation of the entities: 

A Limited Liability Partnership is created by law. It requires furnishing multiple forms. An LLP can be registered only after its partners and designated partners undergo a fixed process and produce necessary acknowledgments.

On the other hand, a partnership firm is created by contract. A mere agreement between the partners can form a partnership firm. 

4. Liability of Partners: 

The liability of partners in the case of a LLP is limited to the value contributed by its partners. The partner’s property is saved in case the entity gets into any kind of business and financial uncertainty. However, the liability of partners in a  Partnership firm is unlimited. 

5. Separate Legal Status: 

A partnership firm has no separate status from its partners in the eyes of the law. The partners act on behalf of the firm as the agent of the firm. Assets are owned by the partners of the firm and the partnership firm cannot sue or be sued in the firm’s name. However, an LLP is a separate legal entity that can exercise all the rights provided to a person under the law. 

6. Perpetual Succession:

A partnership firm depends upon its partner for the management and existence of the firm. The death or retirement of a partner leads to the dissolution of the firm. 

A LLP would not be dissolved due to its partners. It is renowned for the feature of perpetual succession. Partners may come and go but the working of the entity does not stop. 

Eligibility Criteria for LLP Registration

LLP registration requires fulfillment of some basic criteria. If you want to register your business as an LLP make sure you are prepared to meet these primary requirements: 

1. The Limited Liability Partnership should have a minimum of two partners.
2. The LLP should have at least two designated partners. 
3. One of these designated partners should be a resident of India. LLP can have up to fifteen designated partners but at least one of them should be a resident in India. A person is said to be a resident of India if he/she has spent 182 days or more in the country in the previous financial year. 
4. The LLP should have a valid and unique name. The name should be selected as per the provisions of The Limited Liability Partnership Act, 2008, The Companies Act, 2013, the Companies Incorporation Rules, the Trademarks Act, and The Names and Emblems Act. 
5. It shall have a Registered Office address. 
6. The LLP should be formed for business motives. Entities formed for any other purpose shall not be registered as a LLP. 
7. The partners must be able to gather adequate capital. 

Documents Required

There are various documents required for LLP registration. Entities should keep these documents ready along with the above LLP registration requirements. These documents are: 

1. Partner’s KYC documents,
2. Digital Signature Certificate, 
3. Designated Partner Identification Number,
4. LLP agreement,
5. Current Utility Bills that act as proof of address for the registered office. 

Charges/ Fees

The LLP registration fees as charged by MCA for incorporation are as follows: 

LLP Registration Process

An LLP can be incorporated in 5 simple steps: 

Step 1: Drafting the LLP Agreement: 

Once your basic requirements are met, draft an LLP agreement within 30 days of the incorporation of the LLP. Outline people’s roles, and responsibilities and state the contributions of the partners. This should be done before proceeding to Step 2. 

Step 2: File the LLP registration Application:

Visit the MCA portal. Login and fill out the online LLP registration application. This form includes information related to partners, the name of the LLP.

This is how the User Login page will look.

Step 3: Uploading the documents: 

Ensure all your documents are ready and you upload them appropriately. 

Step 4: Generate the SRN: 

Once you follow the above steps, you will be asked to make the payment of requisite fees. Once the payment for LLP registration is done, you will receive your Service Request Number (SRN).

Note down this number for future status tracking of the application. 

Step 5: Certificate Issuance:

The Registrar of Companies (ROC) will thoroughly review your application and suggest any requirements if required. On satisfaction that all compliances are complete within the prescribed rules, ROC will issue an Incorporation Certificate. Receiving a certificate indicates the official incorporation of your firm. 

LLP registration is a legal process to officially incorporate your business entity. If registrations and documentation have taken up your time and complicated your business, let Lawgical Adda handle your problems. At Lawgical Adda, get simple solutions to your complicated problems. We can register your LLP in just 15 days. Click here to register your LLP hassle-free with Lawgical Adda, today!