Looking for a business structure that combines the flexibility of a partnership with the protection of a company? LLP (Limited Liability Partnership) might be perfect for you. This guide covers everything about LLP registration in India.
What is an LLP?
A Limited Liability Partnership (LLP) is a hybrid business structure that combines elements of partnerships and companies. Introduced through the LLP Act, 2008, it offers:
- Limited liability protection for partners
- Flexibility of a partnership
- Lower compliance requirements than companies
- Pass-through taxation (no DDT)
LLPs are particularly popular among professionals (CAs, lawyers, architects) and small businesses looking for a formal structure without extensive compliance.
LLP vs Private Limited Company
| Feature | LLP | Private Limited |
|---|---|---|
| Governed By | LLP Act, 2008 | Companies Act, 2013 |
| Liability | Limited to contribution | Limited to shares |
| Minimum Members | 2 Partners | 2 Directors, 2 Shareholders |
| Minimum Capital | None | None (Rs. 1L authorized) |
| Annual Filing | 2 forms | 6+ forms |
| Audit Requirement | If turnover > Rs. 40L or contribution > Rs. 25L | Mandatory |
| Taxation | 30% flat | 25-30% |
| Foreign Investment | Restricted (approval route) | Easier (automatic route available) |
| Board Meetings | Not required | 4 per year minimum |
Benefits of LLP Registration
1. Limited Liability
Partners' personal assets are protected. Liability is limited to their agreed contribution. One partner is not liable for another's misconduct.
2. Lower Compliance
Compared to companies, LLPs have significantly fewer compliance requirements. No mandatory audit below threshold, fewer forms to file.
3. Flexibility in Management
Partners can decide internal management through the LLP Agreement. No mandatory board meetings or complex governance requirements.
4. Tax Benefits
No Dividend Distribution Tax (DDT). Partners are taxed on their share of profits at individual rates. MAT doesn't apply to LLPs.
5. Easy Transfer of Ownership
Partnership interests can be transferred as per the LLP Agreement without complex share transfer procedures.
Who Should Choose LLP?
- Professional Services: CAs, lawyers, architects, consultants
- Small Businesses: Where compliance cost matters
- Family Businesses: Looking for formal structure
- Service-based Startups: That don't need external funding
- Joint Ventures: Between companies or individuals
Eligibility for LLP Registration
For Designated Partners
- Minimum 2 Designated Partners
- At least one must be Indian resident
- Must have DPIN (Designated Partner Identification Number)
- Must have DSC (Digital Signature Certificate)
- Minimum age 18 years
- Not disqualified under LLP Act
For LLP
- Must have registered office in India
- Partners can be individuals or body corporates
- No minimum capital requirement
- Foreign nationals can be partners (with conditions)
Documents Required for LLP Registration
For Partners
| Document | Details |
|---|---|
| PAN Card | Of all partners |
| Aadhaar Card | Address proof |
| Passport-size Photo | Recent photograph |
| Address Proof | Bank statement/Utility bill (not older than 2 months) |
| Email & Mobile | For OTP verification |
For Registered Office
- If Owned: Property deed + utility bill
- If Rented: Rent agreement + NOC from landlord + utility bill
Step-by-Step LLP Registration Process
Step 1: Obtain DSC (Digital Signature Certificate)
All designated partners need Class 3 DSC for signing documents electronically. Takes 1-2 days.
Step 2: Apply for DPIN (Designated Partner Identification Number)
DPIN is now allotted through the FiLLiP form along with incorporation. Previously required separately.
Step 3: Name Reservation (RUN-LLP)
Reserve your LLP name through the RUN-LLP service. You can suggest 2 names. Guidelines:
- Must end with "LLP" or "Limited Liability Partnership"
- Should not be similar to existing LLPs or companies
- Should not contain prohibited words
- Should indicate nature of business
Example: "TechConsult Advisory LLP"
Step 4: File FiLLiP Form (Incorporation)
The FiLLiP (Form for Incorporation of Limited Liability Partnership) includes:
- LLP incorporation application
- DPIN allotment for partners
- PAN and TAN application
Step 5: Draft and File LLP Agreement
The LLP Agreement must be filed within 30 days of incorporation. It covers:
- Capital contribution of each partner
- Profit/loss sharing ratio
- Rights and duties of partners
- Management and decision-making
- Admission and retirement of partners
- Dispute resolution
Step 6: Certificate of Incorporation
Upon approval, you receive:
- Certificate of Incorporation
- LLPIN (LLP Identification Number)
- PAN and TAN
- DPIN for designated partners
LLP Registration Fees
Government Fees
| Component | Fee |
|---|---|
| Name Reservation (RUN-LLP) | Rs. 200 |
| FiLLiP Filing Fee | Rs. 500 |
| LLP Agreement Filing (Form 3) | Rs. 100-500 (based on contribution) |
| DSC (per partner) | Rs. 1,500-2,000 |
| Stamp Duty | Varies by state (Rs. 1,000-5,000) |
Professional Fees
With LegalX India:
- Basic Package: Rs. 5,999
- Standard Package (with LLP Agreement): Rs. 7,999
- Premium Package (with compliance support): Rs. 12,999
LLP Registration Timeline
| Stage | Duration |
|---|---|
| DSC Issuance | 1-2 days |
| Name Approval | 1-2 days |
| FiLLiP Filing & Approval | 5-7 days |
| LLP Agreement Filing | Within 30 days |
| Total (Certificate) | 10-15 working days |
Post-Incorporation Compliance
Annual Compliance
| Form | Description | Due Date |
|---|---|---|
| Form 11 | Annual Return | May 30 |
| Form 8 | Statement of Account & Solvency | October 30 |
| Income Tax Return | ITR-5 | July 31 / Sept 30 (if audit required) |
When Audit is Required
- Annual turnover exceeds Rs. 40 lakhs, OR
- Partners' contribution exceeds Rs. 25 lakhs
Common Mistakes to Avoid
- Not filing LLP Agreement: Must be filed within 30 days of incorporation
- Missing annual filings: Penalties up to Rs. 100/day for late filing
- Incorrect capital contribution: Must match what's declared in agreement
- Not maintaining statutory registers: Partners register is mandatory
- Ignoring resident partner requirement: At least one must be Indian resident
Frequently Asked Questions
Can a single person start an LLP?
No, minimum 2 partners are required. Consider OPC (One Person Company) for single-member entities.
Is there any minimum capital requirement?
No minimum capital is required. You can start with any amount of contribution.
Can an LLP be converted to a company?
Yes, LLP can be converted to a Private Limited Company following the prescribed procedure.
What happens if an LLP doesn't file annual returns?
Penalty of Rs. 100 per day of default. Persistent non-compliance can lead to LLP being struck off.
Can an LLP do business outside India?
Yes, an LLP can export goods and services. However, FDI in LLP is restricted and requires approval.
Why Choose LegalX India?
- 1000+ LLPs Registered: Extensive experience
- Expert CS Team: Company Secretaries handle your registration
- Custom LLP Agreement: Drafted as per your requirements
- Post-Incorporation Support: Annual compliance assistance
- Transparent Pricing: No hidden charges
Conclusion
LLP is an excellent choice for professionals and small businesses seeking limited liability with minimal compliance. It offers the best of both partnerships and companies.
Whether you're a CA firm, law practice, consulting business, or any service provider, LLP provides the perfect legal structure to protect your personal assets while maintaining operational flexibility.
Register Your LLP Today
Get your LLP registered with expert guidance and customized LLP Agreement.
Register Now - Starting at Rs. 5,999Written by
CS Amit Verma
Company Secretary with 10+ years of experience in LLP and company formations. Registered over 1000+ LLPs across India.