What is a Limited Liability Partnership (LLP)?

  1. LLP is an acronym for Limited Liability Partnership.
  2. An LLP is a type of alternative corporate business structure that combines the advantages of limited liability with partnership flexibility.
  3. Regardless of changes in partners, the LLP can continue to exist.
  • The LLP is a separate legal entity that is liable to the full extent of its assets, but the liability of the partners is limited to their agreed contribution in the LLP.
  • Individual partners are also protected from joint liability produced by another partner’s incorrect business decisions or misconduct because no partner is liable for the independent or un-authorized actions of other partners.
  • Within an LLP, the partners’ mutual rights and responsibilities are governed by an agreement between the partners or between the partners and the LLP, as the case may be.
  • The LLP shall be a body corporate and a legal entity independent from its partners; however, the LLP is not relieved of its liability for its other obligations as a separate entity. It will continue indefinitely.
  • LLP is referred to as a hybrid between a company and a partnership since it combines aspects of both a corporate and a partnership firm structure.

How to register Limited Liability Partnership (LLP)

Following the provisions stipulated in the LLP Act, LLPs must be registered with the Registrar of Companies (ROC) (designated under the Companies Act, 2013). A registered office is required for any LLP. At least two partners must sign an Incorporation Document, which must be filed with the Registrar in the required format. The contents of the LLP Agreement, as prescribed, must also be filed with the Registrar electronically.

Incorporation of the Limited Liability Partnership (LLP)

Step 1 :

LLP name reservation:

The first step in forming a Limited Liability Partnership (LLP) is to reserve the LLP’s name. For determining availability and reserving the name of an LLP business, the applicant must submit eForm 1.

Step 2:

Obtaining Digital Signature Certificates:

Once the proposed LLP’s name has been approved, the next step is to obtain DSC for Designated Partner.

Step 3:

Filip E Form for LLP Incorporation

After reserving a name, the user must file Filip to form a new Limited Liability Partnership (LLP) and pay the required Government fees including Stamp Duty, if applicable. E- Form Filip contains information on the proposed LLP, the partners’/ designated partners’ information, and the partners’/ designated partners’ consent to act as partners/ designated partners.

Step 4:

Certificate of Incorporation:

The Registrar shall review the filed forms and their attachments, and if the filed forms are correct and meet the provisions of the LLP Act and the rules issued thereunder, he shall issue a Certificate of Incorporation.


Required Documents for Incorporation of LLP

1.Documents from Designated Partners and Partners:

 a) Identity Proof:

  1. Permanent Account Number (PAN) Card
  2. Aadhaar Card / Passport / Driving License / Voter Identity Card

 b) Address Proof:

  1. Telephone Bill / Mobile Bill
  2.  Electricity Bill / Water Bill
  3.  Bank Statement /Bank Passbook with latest transaction (Any one of the Document not older than 2 months)

            c) Passport size Photographs – 1 each

Note: All the Copies of Documents must be Self Attested by the applicant

2. Documents to be Signed by Designated Partners / Partner:

  1. Consent to Act as Designated Partners / Partners
  2. Other Particulars of Subscribers
  3. Declaration by Designated Partners / Partners

3. Registered Office – Address:

           a) No-Objection letter from the Owner of Address to use the address of the registered office of the LLP.

           b) Address Proof – In the name of the Owner

   Electricity Bill, Telephone Bill (Fixed Line Only), Gas Bill or Water Bill (Not older than 2 months)                                                   

   c) Copy of Registered Sale Deed

Minimum Requirements for a LLP Registration

LLP Name Should Be Unique:

The proposed LLP name should be unique and should not be similar to or identical to the name of an existing company, LLP, or Registered Trademark.

At Least Two Persons:

A LLP can be formed by at least two people who will function as the Designated Partners.

Capital Requirements:

To register a LLP, no minimum capital contribution is required. Investments might be made based on the needs of the LLP.

The LLP’s Key Objects:

Before the LLP is formed, the LLP’s main objects must be established in order to describe the LLP’s business activities.

Compliances for LLP

In line with the LLP Rules, 2009, the contents of the LLP Agreement, as well as any changes made thereto, may be recorded in Form 3 and details of partners/designated partners may be filed in Form 4.

LLP Agreement:

According to Section 23 of the Act, the execution of an LLP Agreement is required. The LLP Agreement must be filed with the registrar in eForm 3 within 30 days of the LLP’s Incorporation.

Contribution of a Partner

The contribution of a partner may include both actual and intangible assets, as well as any other benefit to the LLP. The monetary worth of each partner’s contribution shall be accounted for and declared in the limited liability partnership’s accounts in the manner stipulated by the regulations.

Requirements for Disclosure, Audit, and Filing

  • An LLP is required to keep annual accounts that show a genuine and fair picture of its financial situation. Every LLP must file an annual “Statement of Accounts and Solvency” in prescribed form with the Registrar.
  • Every LLP’s finances must be audited in accordance with Rule 24 of the LLP Rules 2009. Such laws, for example, provide that any LLP whose annual turnover does not exceed forty lakh rupees or whose contribution does not exceed twenty-five lakh rupees is exempt from having its books audited. If the limited liability partnership’s partners desire to have the LLP’s accounts audited, the accounts will only be audited in compliance with this rule. Within 60 days of the end of the financial year, every LLP would be required to file an annual return on Form 11 with the ROC. On payment of the statutory fees to the Registrar, the yearly return will be available for public inspection.

• The Act requires LLPs to file papers such as Statements of Account and Solvency (SAS) and Annual Returns (AR), as well as notices of changes among partners, within the timeframes specified in applicable provisions. The Act has provisions that allow LLPs to file such documents after their due dates if they pay additional fees. It has been stipulated that LLPs will not be prosecuted if they file relevant documents after their due dates and pay additional fees for up to 300 days. If there is a delay of more than 300 days, the LLPs will be compelled to pay usual filing fees, an extra fee, and may be prosecuted.

The Act also allows for the compounding of offences that are only punished by a fine.