Limited Liability Partnership
A limited liability partnership (LLP) is a partnership in which some or all partners have limited liabilities. In an LLP, each partner is not responsible or liable for another partner’s misconduct or negligence. In LLP the partners have the right to manage the business directly. The Limited Liability Partnership Act 2008 was incorporated in the first week of April. This format would be quite useful for small and medium enterprises in general and for the enterprises in services sector in particular, including professionals and knowledge based enterprises.LLP is a very famous system now a day. , LLPs has been welcomed with more than 1 lakhs registrations until September, 2016.
Features of LLP
Separate Legal entity which distinct partners from each other.
No limitations about Capitals.
It requires minimum 2 partners to create a LLP , and there are no limitations about maximum partners.
Benefits of LLP
Separate Leagal entity.
No requirement of minimum capital.
Minimum number of members.
No requirement of compulsory audit
Reasons for incorporating in LLP
1. It is more flexible to organize the internal structure of LLP than other entity.
2. There is no maximum limit for the number of partners in LLP.
3. Raising and utilization of funds depends on the partners will, under the Companies Act, 2013.
4. LLP is exempt from Dividend Distribution Tax (DDT). Company has to pay DDT on dividend distribution.
LLPs as well have some limitations within. Some of them can be summarized as below.
Any act of the partner without the other partner may bind the LLP
LLP cannot raise money from the public.
Angel investors and venture capital firms generally prefer not to invest in LLPs. Private Limited is preferred over LLP.
the liability of the partners for the debts of the business is unlimited
each partner is ‘jointly and severally’ liable for the partnership’s debts; that is, each partner is liable for their share of the partnership debts as well as being liable for all the debts
there is a risk of disagreements and friction among partners and management
each partner is an agent of the partnership and is liable for actions by other partners
if partners join or leave, you will probably have to value all the partnership assets and this can be costly.
Obtain digital signature for the partners.
Apply for the DIN (Director Identification Number) which is necessary to become a partner in the LLP.
Send a application for name approval for the LLP registration.
Registrar of Companies issues the Certificate of Incorporation which is the proof for the registration.
File for a Permanent Account Number (PAN) from.
File LLP agreements and open a current bank account.
Company details can be checked on Ministry of Corporate Affairs, Companies Master Data Website
Registration for LLP
Sujata Associates is a leading service provider, we offer Limited Liability Enterprises registration service at affordable price . We believe in providing quality services and keeping our customers up to dated and informed to registering their companies in India & across the globe. Our aim is to provide complete satisfaction and solution to your problems professionally with integrity sincerity and personal attention.
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