limited liability partnership (LLP)

A limited liability partnership (LLP) is a partnership in which some or all partners (depending on the jurisdiction) have limited liabilities. It therefore can exhibit elements of partnerships and corporations. In an LLP, each partner is not responsible or liable for another partner's misconduct or negligence.

Startuphouz offers LLP Registration at Rs.7,299/-

LLP Form

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Basic

7,299

all Inclusive fees

LLP Registration With 2DSC, 2 DIN, LLP Deed drafting, 1 Lakh Capital Contribution, name approval, MSME Regn, PAN & TAN

(Fees Inclusive of government fee and taxes)

Basic

7,299

all Inclusive fees
Standard

9,999

all Inclusive fees

LLP Registration With 2DSC, 2 DIN, LLP Deed drafting, 1 Lakh Capital Contribution,name approval, MSME Regn, GST Regn, PAN & TAN

(Fees Inclusive of government fee and taxes)

Standard

9,999

all Inclusive fees
Premium

13,499

all Inclusive fees

LLP Registration With 2DSC, 2 DIN, LLP Deed drafting, 1 lakh capital contribution, name approval, MSME Regn, GST Regn, PAN & TAN and GST Filing for 3 Months

(Fees Inclusive of government fee and taxes)

Premium

13,499

all Inclusive fees
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LLP Registration

A limited liability partnership (LLP) is a partnership in which some or all partners (depending on the jurisdiction) have limited liabilities. It therefore can exhibit elements of partnerships and corporations. In an LLP, each partner is not responsible or liable for another partner's misconduct or negligence. The main advantage of a Limited Liability Partnership over a traditional partnership firm is that in a LLP, one partner is not responsible or liable for another partner's misconduct or negligence. A LLP also provides limited liability protection for the owners from the debts of the LLP. Therefore, all partners in a LLP enjoy a form of limited liability protection for each individual's protection within the partnership, similar to that of the shareholders of a private limited company. However, unlike private limited company shareholder, the partners of a LLP have the right to manage the business directly. LLP is one of the easiest form of business to incorporate and manage in India. With an easy incorporation process and simple compliance formalities, LLP is preferred by Professionals, Micro and Small businesses that are family owned or closely-held. Since, LLPs are not capable of issuing equity shares, LLP should be used for any business that has plans for raising equity funds during its lifecycle. Startuphouz is the market leader in LLP registration services in India. In addition to LLP registration, Startuphouz also offers a variety of business registration services like private limited company registration, one person company registration, Nidhi Company Registration, Section 8 Company Registration, Producer Company Registration and Indian Subsidiary registration. The average time taken to complete a LLP registration is about 15 - 20 working days, subject to government processing time and client document submission. Get a free consultation on LLP registration and business setup in India by scheduling an appointment with anStartuphouz Advisor.

Benefits of LLP Firm Registration

Easy To Establish

It is relatively easy to establish and register the LLP business than Private Limited Company. There is no specific process to be followed to setup this business. Also the cost of LLP registration is very less compared to any other business structure.

Separate Legal Entity

A LLP is a legal entity and a juristic person established under the Act. Therefore, a LLP has wide legal capacity and can own property and also incur debts. However, the Partners of a LLP have no liability to the creditors of a LLP for the debts of the LLP.

Audit Not Required

A LLP does not require audit if it has less than Rs. 40 lakhs of turnover and less than Rs.25 lakhs of capital contribution. Therefore, LLPs are ideal for startups and small businesses that are just starting their operations and want to have minimal regulatory compliance related formalities.

Owning Property

A LLP being an artificial judicial person, can acquire, own, enjoy and sell, property in its name. No Partner can make any claim upon the property of the LLP - so long as the LLP is a going concern.

Comprative Business
Private Limited Company One Person Company Limited Liability Partnership Partnership Firm Proprietorship Firm
Act Companies Act, 2013 Companies Act, 2013 Limited Liability Partnership Act, 2008 Indian Partnership Act, 1932 No specified Act
Registration Requirement Mandatory Mandatory Mandatory Optional no
Number of members 2 – 200 Only 1 2 – Unlimited 2 – 50 Only 1
Separate Legal Entity Yes Yes Yes No No
Liability Protection Limited Limited Limited Unlimited Unlimited
Statutory Audit Mandatory Mandatory Dependent Not Mandatory Not Mandatory
Ownership Transferability Restricted No Yes No No
Uninterrupted Existence Yes Yes Yes No No
Foreign Participation Allowed Not Allowed Allowed Not Allowed Not Allowed
Tax Rates Moderate Moderate High High Low
Statutory Compliances High Moderate Moderate Less Less

Pros and Cons of a Limited Liability Partnership (LLP) registration versus a Private Limited registration for Startups

Selection of a business entity is among the primary lawful choice taken by an Entrepreneur while starting a new business. With the presentation of the Limited Liability Partnership Act and the Companies Act, 2013, more decisions of business entities are currently accessible. In this way, it is vital for the Entrepreneur or Promoter to comprehend the upsides and downsides of every one of the business element and pick the correct one. In this article, we look at those kinds of elements viz.LLP versus Private Limited Company.

i.Registration

  • LLp:
  • Limited liability partnership will be enlisted with the Ministry of Corporate Affairs under the Limited Liability Partnership Act, 2008.
  • Private Limited Company:
  • Private Limited company will be registered with the Ministry of Corporate Affairs under the Companies Act, 2013.

ii.Name of the Entity

  • LLp:
  • The name given by the founders must be approved by the Registrar of Company. The name proposed for approval should not be similar to existing LLPs and Companies or similar to a brand name or a trademark. The name should be unique and must be easily distinguishable from other LLPs and Companies. The name of the business will end with the words "Limited Liability Partnership" or "LLp".
  • Private Limited Company:
  • The name selection and approval process is similar for private limited company and LLP. The name of the entity will end with the words "Private Limited".

iii.Legal Status of the Entity

  • LLp:
  • LLP is a separate legal entity registered under the LLP Act, 2008.The one partner of the LLP not liable for the acts of the other partners done without consent. For example if Mr. X borrows money in the name of the LLP without the consent or knowledge of Mr. Y who is the partners. Mr. Y will not be liable to the amount due.
  • Private Limited Company:
  • Private Limited Company is a separate legal entity registered under the Companies Act, 2013. The Directors and Shareholders of a Private Limited Company are not personally liable for the liabilities of the Company.

iv.Member(s) Liability

  • LLp:
  • Partners have limited liability and are at liable only to the extent of their contribution to the LLP.
  • Private Limited Company:
  • Investors have limited liability and are liable only to the extent of their share capital.

v.Minimum Number of Members

  • LLp:
  • At least two people are required to start an LLP.
  • Private Limited Company:
  • At least two people are required to start a Private Limited Company.

vi.Maximum Number of Members

  • LLp:
  • A LLP can have unlimited number of Partners.
  • Private Limited Company:
  • A Private Limited Company can only have a maximum of 200 shareholders.

vii.Foreign Ownership

  • LLp:
  • Foreign national and foreign companies are permitted to invest into an LLP with prior permission from the RBI and Foreign Investment Promotion Board (FIPB) approval.
  • Private Limited Company:
  • Foreign national and foreign companies are allowed to invest in a private limited under automatic route and approval route.

viii.Transferability

  • LLp:
  • Ownership can be transferred.
  • Private Limited Company:
  • Ownership can be transferred by way of share transfer.

ix.Existence or Survivability

  • LLp:
  • Presence of a LLP isn’t reliant on the Partners. Could be wound up willfully or by an Order of the Company Law Board.
  • Private Limited Company:
  • Presence of a Private Limited Company isn’t reliant on the Directors or Shareholders. Could be would up just willfully or by Regulatory Authorities.

x.Taxation

  • LLp:
  • LLP profits are taxed at 30% plus surcharge and cess as applicable. Dividend Distribution Tax (DDT) is not applicable for LLPS
  • Private Limited Company:
  • Companies having turnover less than Rs 250 Cr will be taxes at 25% plus cess and Companies having turnover more than 250 Cr will be taxes at 30% plus cess. DDT is application while distributing dividend.

xi.Annual Statutory Meetings

  • LLp:
  • No requirements to conduct annual statutory meetings.
  • Private Limited Company:
  • Private limited company must hold a minimum of 4 Board meetings in a financial year and 1 General Meetings in a financial year.

xii.Annual Filings

  • LLp:
  • LLP must form 11, form 8 with MCA every year within the due dates specified under the law.
  • Private Limited Company:
  • Private Limited Company must record Annual Accounts and Annual Return with the Registrar of Companies every year.

xiii.Registration Cost

  • LLp:
  • StartuphouZ offers LLP Registration at an all inclusive price of Rs.7,299/-
  • Private Limited Company:
  • StartuphouZ offers Private Limited Company Registration at an all inclusive price of Rs. Rs.7,499/-