Limited Liability Partnership
Limited Liability Partnership (LLP) is a new form of corporate structure that combines the flexibility of a partnership and legal structure of the Company. The advantages of limited liability of a company at a low compliance cost. In other words, it is an alternative corporate business vehicle that provides the benefits of limited liability of a company, but allows its members the flexibility of organising their internal management on the basis of a mutually arrived agreement, as is the case in a partnership firm.
To be submitted by Partners
- Copy of Pan Card
- Copy of ID Proof - Voter’s ID / Passport / Driving License/Aadhar Card
- Copy of Residential Proof - EB Bill / Telephone / Landline Bill or Saving Bank Account Statement (not older than 2 months)
- Passport Size Photograph (only for Designated Partners)
Note : Any one of the Partner must self - attest the documents
For the Registered Office
- Rental / Leese Agreement of Office Premises, if rented
- Sale / Property Deed, if owned Property
- Latest Electricity Bill or Property Tax Bill
- NOC from owner of the Property.
Note : Registered office need not be a commercial space.
Can start LLP with lower Contribution
Limited Liability can be formed without any minimal requirement of Contribution, For instance, partner of the LLP can bring Rs. 20,000/- or Rs. 10,000/- or even Rs. 5,000/- as their contribution. The obligation of contribution by the partners could be made in installments and need not to be made with immediately after it registration.
Lesser Compliance than a Private Limited Company
There will be very minimal annual compliance in LLP, but in the case of company requires more compliance than the LLP. Therefore for LLP is a good choice for stating the business who needs lesser compliances.
The LLP is a legal entity and it is separated from its partners. It is managed by the Designated Partners who shall be governed by the LLP Act and Agreement. If any insolvency or insanity or death or change in partnership does not affect the continuity of the LLP.
The compromise or arrangement including merger and amalgamation of LLPs also available and shall be in accordance with the provisions of the LLP Act 2008.
Liabilities of partners is limited to their obligation Contribution
The liability of the partners limited to their agreed contribution in the LLP which may be of tangible or intangible nature or both tangible and intangible in nature. No partner would be liable on account of the independent or un-authorized actions of other partners or their misconduct. The liabilities of the LLP and partners who are found to have acted with intent to defraud creditors or for any fraudulent purpose shall be unlimited for all or any of the debts or other liabilities of the LLP.
No Audit is requirement upto turnover of 40 Lakhs
If you start a business as Company, the Audit of accounts is mandatory. But in case of LLP, audit is not mandatory if the contribution and turnover of the LLP does not exceeds Rs. 25Lakhs and Rs.40 Lakhs respectively.
Unlimited in No. of Partners
There is no restriction on maximum number of partners in LLP, but in case of Private Limited Company upto 200 members as maximum number of members.