LLP Means Limited liability partnership which is form under The Limited Liability Partnership Act, 2008.These days LLP registration or start up an LLP is going very popular among newcomer business starter.
The LLP structure is available in all over the world countries like the United Kingdom, United States of America, various Gulf countries, Australia and Singapore.
LLP is now become a very best alternative to starting a business in India because of its unique feature.it have both features some of the partnership and some of the company that’s why it is going very favourite option for newcomer businessman or partners to start a Limited Liability Partnership.
So next question arises what is the difference between Limited liability partnership and normal partnership.
Difference between LLP & ” partnership firm”
Under “ OLD or we can say traditional partnership firm”, every partner is responsible, jointly with all the other partners and also exclusively for all acts of the firm done while he is a partner.
But Under LLP structure, the liability of the partner is limited to his agreed contribution. Further, no partner is liable on account of the autonomous or unauthorized acts of other partners, thus allowing individual partners to be protection from joint liability created by another partner’s wrongful acts or any wrongdoing.
Besides of unique and very best benefits, it has some limitation and drawbacks too.
WHAT Are FEATURES OF LIMITED LIABILITY PARTNERSHIP?
LLP is an option corporate business form that gives the advantages of limited liability of a company and the UTMOST flexibility of a partnership.
The LLP can continue its life irrespective of variations in partners. It is able of entering into contracts and owning property in its own name.
The LLP is a separate legal entity. it is liable to the full extent of its assets but the liability of the partners is limited to their agreed contribution in the LLP. only.
Moreover, no partner is liable on account of the autonomous or un-authorized actions of other partners, thus individual partners are guarded against joint responsibility created by another partner’s wrongful business decisions or mischief.
Mutual rights and duties of the partners are governed by an agreement between the partners and the LLP as the case may be.
Considering the facts LLP contains components of both ‘a corporate structure’ as well as ‘a partnership firm structure’ LLP is called a combination between a company and a partnership.
LLP shall be a body corporate and a legitimate entity separate from its partners. It will have perpetual succession.
WHAT IS THE ADVANTAGE OF STARTING A LLP?
LLP form is a form of business model which:
(i) is organized and operates on the basis of an agreement between partners.
(ii) provides flexibility to the business and partners without imposing so many legal impositions.
(iii) LLP will have more elasticity as compared to a company.
(IV) LLP will have lesser compliance conditions and provisions as compared to a company.
How To Register LLP in India? how much it costs?.
if you want register LLP in India, you need to first apply for a Designated Partner Identification Number (DPIN), which is to be done by filing eForm for obtaining the DIN or DPIN. after acquiring DIN You would then need to acquire your Digital Signature Certificate and register the same on the portal.
AFTE THAT, Search for availability of a name if the name is available you should get that, if not you need to get the LLP name approved by the Ministry. Once the LLP name is approved, you can register the LLP by filing the incorporation form.
Step 1: File Application for DIN or DPIN
All assigned partners of the proposed LLP shall obtain “Designated Partner Identification Number (DPIN)”. You need to file eForm WHICH IS DIN-1 in order to obtain DIN or DPIN. In case you already have a DIN (Director Identification Number), the same can be used as a DPIN.
Step 2: Acquire/ Register DSC.
The Information Technology Act, 2000 affords for the use of Digital Signatures on the documents submitted in electronic form in order to secure the safety and authenticity of the papers filed electronically. This is the unique secure and authentic way that a document can be submitted electronically. As such, all filings done by the LLP(s) are obliged to be filed with the use of Digital Signatures by the person approved to sign the documents.
Acquire Digital Signature Certificate -A licensed Certifying Authority (CA) issues the digital signature. Certifying Authority (CA) means a person who has been granted a license to issue a digital signature certificate under Section 24 of the Indian IT-Act 2000.
Register Digital Signature Certificate – Role check can be done only after the signatories have registered their Digital signature certificates (DSC) with LLP application.
Step 3: New User Registration
For file an eForm or to avail any paid service on LLP portal; you have to be first required to register yourself as a user in the relevant user category, for example, registered and business user.
Step 4: Incorporate an LLP
In the 4th step you have to Apply for the name of the LLP to be registered by filing Form 1 (Application for reservation or change of name) for the same. After that depending upon the proposed LLP, file required incorporation Form 2 ( Incorporation document and Subscriber’s statement)
Once the form has been validated by the concerned adjudicator of the Ministry, you will receive an email regarding the same and the status of the form will get switched to Approved.
Step 5: File LLP Agreement
After the incorporation of LLP, an introductory LLP agreement is to be filed within 30 days of incorporation of LLP. The user has to file the information in Form 3 ( Information with regard to Limited Liability Partnership Agreement and changes, if any change, made therein).
How much LLP Registration Cost You in India?
There may be variation in change of the cost of registration.
Approximately for register Limited Liability Partnership in India, it cost you Near RS.9000-11000.