Limited Liability Partnership (LLP) is a new form of partnership in India, introduced in the year 2008 and regulated by The Limited Liability Partnership Act 2008.
As the name suggest liability of the partners are limited to the extent of their share. The main object is that one partner should not be liable for the act or negligence of other partner. It combines the features of partnership and a company.
People generally got confused with the selection whether to go for Company or Partnership or LLP. LLP is for those who want to run business as a separate entity and with limited liability, with less compliance and.
Alonika.in is the right option to begin the journey. Get LLP Registered by Professionals like Chartered Accountants and Company Secretaries. Just contact us for LLP Registration and stay focused towards the dreams of success.
Documents Required for LLP
- Aadhar card and PAN card of all partners. (Passport in case of NRI or Foreign Partner)
- Passport Size Photos of all partners.
- Bank statements of all partners not older than 2 months.
- 2 Proposed Names for Firm
- Business Object
- Address Proof of place of business (Electricity bill or Rent Deed or Registry)
- Contact Details of all partners (Email id and Mobile No)
Advantages of LLP
Limited Liability: Not like as partnerships, Liability of Partners are limited to the extent of their capital contribution only, hence no impact on partners personal assets.
Separate Legal Entity: As a Company, LLP do enjoys separate legal entity. The Limited Liability Partnership Act 2008, defines LLP as a separate legal entity then its partners.
Less Compliance: Compliance under LLP is less in compare to Companies; even the audits are also not required for every LLP.
Difference between Limited Liability Partnership and Partnership
|PARTICULARS||LIMITED LIABILITY PARTNERSHIP||PARTNERSHIP|
|GOVERNED BY:||Limited Liability Act, 2008||The Partnership Act, 1932|
|TIME For Incorporation||7-10 days in complete process||5-7 days|
|LIABILITY||Limited, to the extent their contribution towards LLP, except in case of intentional fraud or wrongful act of omission or commission by the partner.||Unlimited. Partners are severally and jointly liable for actions of other partners and the firm and liability extend to their personal assets.|
|TAX LIABILITY||30%+ health and education cess||30%+ Health and education cess|
|PRINCIPAL/AGENT RELATIONSHIP||Partners act as agents of LLP and not of the other partners.||Partners are agents of the firm and other partners.|
|DIRECTOR IDENTIFICATION NO./ DESIGNATED PARTNER IDENTIFICATION NO.||Each Designated Partners is required to have a DPIN before being appointed as Designated Partner of LLP.||The partners are not required to obtain any identification number|
|DIGITAL SIGNATURE||As forms are filled electronically, therefore one Designated Partner should have Digital Signatures.||There is no requirement of obtaining Digital Signature|
|ANNUAL FILING||Annual Statement of accounts and Solvency & Annual Return is required to be filed with Registrar of Companies every year.||No return is required to be filed with Registrar of Firms|
|AUDIT OF ACCOUNTS||All LLP except for those having turnover less than Rs.40 Lacs or Rs.25 Lacs contribution in any financial year are required to get their accounts audited annually as per the provisions of LLP Act 2008.||Partnership firms are only required to have tax audit of their accounts as per the provisions of the Income Tax Act|
|CREDIT WORTHINESS OF ORGANIZATION||Will enjoy Comparatively higher creditworthiness from Partnership due to Stringent regulatory framework but lesser than a company.||Creditworthiness of firm depends upon goodwill and creditworthiness of its partners|
|NUMBER OF MEMBERS||Minimum 2 partners and there is no limitation of maximum number of partners.||Minimum 2 and Maximum 20|
|REGISTRATION||Registration with Registrar of LLP required.||Registration is optional|