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What is LLP Registration Process? 25 June, 2020   

LLP is a kind of business form which combines the flexibility of partners and the benefits of limited liability at a very nominal cost of compliance.

LLP offers the benefit of limited liability to its owners and minimal maintenance. The owner of a private limited company has limited liability to its creditors. In the case of nonpayment of debt, banks/creditors can only sell the company’s assets and not the personal assets of owners. LLP is a hybrid of a company, as well as a partnership firm.

This the article includes the process related to LLP Registration.

What are the features of LLP Registration?

The features of LLP registration are-

  1. Separate Legal Entity
  2. Minimum 2 Persons Required
  3. No Minimum Capital Contribution
  4. Governed By LLP Agreement
  5. Low Cost
  6. Less Compliance
  7. Limited Liability

What are the documents necessary for LLP Registration?

The documents required by Partners are-

  1. ID Proof
  2. Address Proof
  3. Residential Proof
  4. Photograph
  5. Passport In Case Of NRIs

The documents required for LLP

  1. Registered Office Address Proof
  2. Digital Signature Certificate

What is the need of LLP registration?

The concept of a Limited Liability Partnership is useful for small and medium-sized enterprises. Limited Liability Partnership is responsible for its losses and debt taking place in business, rather than that of its partner. Therefore, LLP is considered as a profit-making business.

The operating business can be a member of LLP and shall have at least two members. The rights and responsibilities of all members should be laid down in “Deed of Partnership.”

What is the process of LLP registration?

Step-1 

Designated Partners identification number (DPIN)

DPIN is mandatory for all the proposed partners of the limited liability partnership firm. Form DIR-3 is filed to obtain DPIN. A scanned copy of Aadhar card, as well as PAN card along with the form, has to be submitted, which has to be signed by the company’s secretary or director of LLP. 

Step-2

Name Approval

Selecting a name for the limited liability partnership firm is the third step under the LLP registration procedure. The applicant has to form an LLP-RUN form. Te name has to be unique and non-offensive. An applicant provides two names, which are further analyzed by the registrar of the company. In case of rejection, you can again submit your form after 15 days.

Step-3

Filing of Incorporation Form 

Once the name has been selected, you can further move ahead to the incorporation of your firm. Form for incorporation of limited liability partnership, i.e., FiLLiP, is to be filed. It is registered with the registrar of the firm, and a prescribed incorporation fee is to be paid. 

Documents are duly checked by the authorities, and after that, the incorporation certificate is issued.

What are the post compliances for registration of LLP?

Once the LLP is incorporated, post compliances are to be fulfilled. The post incorporation compliances are-

  1. LLP agreement: It is an important document which defines the rights and duties of all the members of the LLP firm. It is done to avoid future conflicts and disputes in partners. LLP agreement should be filed within 30 days of incorporation of LLP. It has to be printed on the stamp paper and duly signed by all the partners. 
  2. Apply for PAN & TAN: A firm cannot open a bank account without PAN or TAN 
  3. Bank Account Opening: After getting PAN, open your bank account in the name of the registered firm.

What are the factors to be considered while selecting the name for the company?

    The factors that are considered while choosing any name are as follows-

    Meaningful 

    The name of the corporation should be related to your business. It should resemble the company’s branding.

    Short & Simple

    The name of the company must be quick and straightforward. Easy pronounced by people, and they can remember the company name in the first instance.

    Unique

    Name of the company should not be identical to an existing company, business or trademark

    Blacklist

    Abstracts, adjectives, and generic words are blacklisted. 

    No existing Trademarks

    No certified logo or any identical name on the IP India website should be used. 

    Suffix

    The name of the LLP company must finish with the suffix “LLP” as in limited liability partnership.

    Descriptive Name

    The title should describe a little about the type of business you are in.

    Illegal or offensive

    Make sure you don’t go against the law. The name should not be abusive or against any customs or beliefs of any religion and doesn’t harm anyone

    What is the process for LLP Name change?

    Any LLP registered partnership firm can change its name by submitting the following forms: -

    1. Form 1 is required to be filled for name approval (Application for reservation or change of name)
    2. After the name gets approved, the applicant is required to file Form 5 (Notice for change of nameto let the registrar about the name change of LLP

      What is the process to change the registered office of the registered LLP?

      In case LLP wants to change its registered office, Form 15 (Notice for change of place of registered office) has to be filed with the registrar

      What is the process to change the LLP Agreement?

      LLP can change the LLP Agreement by submitting Form 3 (Information concerning Limited Liability Partnership Agreement and changes, if any, made therein). However, in case the change in LLP agreement is due to a change in partners/ designated partner, Form 4 has to be filed along with Form 3.

      What are Types of Forms Applicable for LLP 

      Name

      Purpose

      RUN-LLP

      Form for reservation of the name of the firm

      FiLLiP

      Form for LLP incorporation

      Form 5

      Notice for the name change

      Form 17

      Application for conversion of a firm into LLP

      Form 18

      Application for conversion of a private or public company into LLP

      What is the cost involved in LLP Registration Process?

      The government fees for filing forms are as follows-

      Step

      Cost

      Step 1 – DSC

      Around Rs. 1500-2000 for 2 partners(varies depending on the agency)

      Step 2 – DIN

      Rs. 1000 for 2 partners

      Step 3 – Name Reservation

      Rs. 200

      Step 4 – Incorporation

      It depends upon capital involvement.

      Contribution up to INR 1 lakhs – INR 500,

      Contribution between INR 1 and 5 lakhs – INR 2000

      Step 5 – LLP Agreement

      It depends upon capital involvement.

      Contribution up to INR 1 lakhs – INR 50 for filing of Form 3 & stamp duty based on the state where LLP is formed

      How much time involved in the Registration Process?

      LLP Registration takes approximately 15 days, according to the availability of all the documents.

      Conclusion 

      The introduction of a Limited liability partnership will provide a new option for partnerships that are anxious about their exposed liability. Because of the growth of the Indian industry, LLPs will contribute to the growth of the sector and a large number of existing companies, public as well as private. LLP registration in India has become more comfortable after coming of the Limited Liability Partnership Act, 2008.
      In case of any query, contact Corpbiz.

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