Limited Liability Partnership (LLP) Registration as the name recommend defines limited liability to its partners. Therefore it has features of both, a company and a partnership. One associate is responsible for only his own actions and not the actions of his associate. LLPs are governed by Limited Liability Partnership Act (LLP Act), 2008.
FEATURES OF LLP
- 1. LLP company be treated like any other partnership firm for taxation purposes
- 2. One of the partners in LLP , have to be an Indian
- 3. Registrar of Companies under MCA registers andcontrols LLPs in India
- 4. No partner is liable on account of the independent or unlawful actions of other partners, thus allowing individual partners to be protected from joint liability created by another partner’s wrongful business decision or misconduct.
- 5. Liability is limited to every partner agreed upon contribution to the LLP Company in India.
APPLICATION FOR NAME APPROVAL
This process involves registering the LLP. Before you do this, you would must to see if the name is already taken. You can check on the free search feature on the MCA portal. The registrar only approves LLP names that are not taken before.
LLP agreement is very crucial in a limited liability partnership as it determines the mutual rights and duties amongst the partners, and between the LLP and the partners. The partners enter into the LLP contract upon the LLP registration by filing forms online on the MCA portal. This process has to be done within 30 days of the date of incorporation.
Audit not Required
Entrepreneurs earn a turnover of less than 40 Lakhs and capital input of less than 25 Lakh need not get their financial records audited .Therefore, LLPs are perfect for startups and small businesses that are very soon starting their operations and want to have least regulatory compliance related formalities.
Time Involved In Registration Process
LLP structure starting from obtaining DSC to Filing Form 3 takes about 20 days subject to availability of all the required documents.
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For more information on documents necessary for partnership registration click here
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