Setting up a Limited Liability Partnership (“LLP”) involves registering the business with the appropriate government authorities, appointing designated partners, and fulfilling legal requirements. It’s a flexible structure that combines limited liability with the simplicity of a partnership, making it an attractive option for many businesses.

Key points for consideration

• Governing Act- Under the Limited Liability Partnership Act of 2008, LLP is a distinct legal person that has been registered. The LLP’s designated partners are responsible for any violations of the legislation.
• Member- An LLP requires a minimum of two partners, with no maximum limit on the number of partners that can participate in the business.
• Designated Partners- There must be two designated partners in a Limited Liability Partnership.
• Subscription of shares- In a Limited Liability Partnership, public subscriptions are not allowed.
• Managerial Remuneration- It is based on an LLP agreement.
• Annual Statutory Filing- Annual statement of solvency and annual return with Registrar of Companies (“ROC”).
• Annual Filling and Audit- An audit is mandatory in cases where turnover exceeds INR 40 lakhs or contribution exceeds INR 25 lakhs.

For a Limited Liability Partnership

• Subscriber’s sheet
• Proof of registered office address, lease agreement, Non-Obligation Certificate (“NOC”) from the owner, and utility bill not older than 2 months
• Declarations and consents by partners and designated partners
• Interest of partners and designated partners in other entity
• Proof of identity and address of partners and designated partners
• Proof of identity and address of the witness to the subscriber’s sheet (not required in cases where the witness is a professional, such as Chartered Accountant/ Company Secretary)
• Foreign Exchange Management Act Declaration.

Registration Regime of a Limited Liability Partnership

The registration process for a Limited Liability Partnership involves several key steps to establish the entity legally. Here’s an overview of the registration regime for an LLP:

• Name Reservation: Choose a unique name for the LLP and ensure its availability by checking with the relevant government authority. The chosen name must adhere to naming guidelines and should not resemble the names of existing LLPs or companies.
• Designated Partners Identification Number (“DPIN”): Designated Partners (similar to directors in a company) must obtain DPINs by filing Form DIR-3 or by applying through the LLP registration process.
• Digital Signature Certificate (“DSC”): At least one designated partner must obtain a DSC to sign documents electronically during the registration process.
• Filing LLP Agreement: Draft and file the LLP Agreement, which outlines the rights, duties, and responsibilities of each partner and the LLP’s operation. This agreement is filed in Form 3 with the ROC.
• Incorporation Documents: Prepare and file the incorporation documents, including Form 2 (Statement of Account & Solvency) and Form 4 (Notice of Appointment of Partners), with the ROC.
• Payment of Registration Fees: Pay the prescribed registration fees based on the capital contribution of the LLP.
• Certificate of Incorporation: Once the ROC processes and approves the documents, they issue a Certificate of Incorporation, officially recognizing the LLP as a legal entity.
• PAN and TAN Application: Apply for a Permanent Account Number (“PAN”) and Tax Deduction and Collection Account Number (“TAN”) for tax purposes.
• Bank Account Opening: Open a bank account in the name of the LLP and deposit the initial capital contribution as specified during the registration process.
• Statutory Compliance: Comply with ongoing regulatory requirements, including filing annual returns, maintaining accounting records, conducting designated partners’ meetings, and adhering to tax and regulatory laws.

How can we help?

We can assist in setting up a LLP in India by providing comprehensive guidance on the registration process, including name reservation, obtaining Designated Partners Identification Numbers (“DPINs”) and Digital Signature Certificates (“DSCs”), drafting and filing the LLP Agreement, handling incorporation documents and fee payments, obtaining the Certificate of Incorporation, and ensuring compliance with all regulatory requirements. Our services aim to streamline the LLP registration process and facilitate a smooth and legally compliant establishment of your business in India.