In India, Limited Liability Partnerships became popular after the enactment of the Limited Liability Partnership Act in the year 2008. Many start-ups and small businesses chose this form of partnership over the traditional form of partnership and company as it offers the advantages of both the partnership and company.
The leading edge of an LLP is one partner is not responsible for the other partner's wrongdoing or negligence. Professionals, Micro and Small enterprises prefer to form LLP for their business. LLP offers the benefit of limited liability towards owners and, at the same time, needs minimum maintenance.
Minimum Requirement for Limited Liability Partnership:
A minimum number of two Designated partners who are adults.
One of the partners of a Limited Liability Partnership has to be an Indian Citizen and Indian Resident.
The other partner(s) can be a Foreign National.
The partners can be natural persons or an artificial legal entity.
Benefits of Forming an LLP
There are many benefits to run a business by constituting as an LLP which is outlined below:
- Dual advantages- Partnership with features of a company
- No partner can be responsible for another partner's misconduct
- Less expensive to incorporate than a private limited company
- Limits the liabilities of its partners
- Can raise funds from partners, banks and NBFCs
Documents required to register a Limited Liability Partnership
Documents from Partners / Designated Partners
Permanent Account Number (PAN) Card
Aadhaar Card / Passport / Driving License / Voter Identity Card
Telephone Bill / Mobile Bill
Electricity Bill / Water Bill
Bank Statement /Bank Passbook with latest transaction
*(Any one of the Document not older than 2 months)
Passport size Photographs
- All the Copies of documents must be Self-Attested by the applicant.
- Telephone Bill / Mobile Bill/Electricity Bill / Bank Account Statement must be in the name of applicant and should not be older than 2 months.
- In case of NRI or Foreign National, documents of partner(s) must be apostilled.
Registered Office – Address
- No-Objection letter from the Owner of Address to use the address of the
registered office of the Company.
- 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);- To be signed by the of the Owner of Premises.
- Rent Agreement (if rented)
Partnership is an association two or more persons who have mutually decided to carry out business activities jointly and to share its profits as well as losses.
Minimum Requirement for Partnership firm:
A minimum number of two partners who are adults.
- One of the partners of a Partnership firm has to be an Indian Citizen and Indian Resident.
- The other partner(s) can be a Foreign National.
- It is voluntary to register a partnership firm in the Indian Partnership Act, 1930
Advantages of Partnership firm Registration
- Easy Formation
Documents required to register a partnership firm
- ID Proof Of All Partners Like Pan Card, Aadhar Card (Uid), Passport, Driving Licence, Election Id Card, Etc
- Current Office Address Proof Like Valid Rent Agreement, Property Document, Noc From The Landlord (If Rented)
- Five Suggested Names
- Nature Of The Business
- Details of proposed business
- Details of capital contribution and profit sharing ratio.