LLP
Company Registration

1. What is an LLP in India?

An LLP, also known as a Limited Liability Partnership, is a business structure that combines elements from both partnerships and companies. It offers partners the benefit of liability while retaining the flexibility of a partnership setup.

2. How is an LLP different from a traditional partnership?

Unlike traditional partnerships, an LLP provides partners with liability protection safeguarding their personal assets in case of business losses.

3. What are the advantages of registering an LLP in India?

Limited liability, reduced compliance compared to companies, no minimum capital requirement, and operational flexibility.

4. What are the disadvantages of an LLP in India?

LLPs may be less attractive to investors, may require audits if turnover exceeds limits, and have limited fundraising options.

5. Who can register for an LLP in India?

Any two or more individuals or entities can come together to create an LLP within the jurisdiction provided that one designated partner maintains residency status, within the country.

6. What is the minimum capital requirement for LLP registration in India?

LLPs can be set up without any capital requirement making them a popular option for medium businesses.

7. How is an LLP taxed in India?

LLPs are taxed similarly to partnership firms and are subject to income tax. The profits distributed among partners are exempt from taxation.

8. Can an existing business be converted to an LLP in India?

Yes, companies and registered partnerships can convert into LLPs by following the Limited Liability Partnership Act of 2008.

9. Which documents are essential for registering an LLP in India?

PAN cards, proof of address, registered office documents, and digital signatures of partners are required.

10. How long does it typically take to complete the registration process for an LLP in India?

Usually 15 to 20 days, depending on document submission and government processing.

11. What is the process of LLP registration in India?

Obtain DSC, DIN, get name approval, file incorporation documents, and submit the LLP Agreement within 30 days of incorporation.

12. Is it necessary to have a written LLP agreement?

Yes, it outlines the partners' rights, responsibilities, and profit-sharing ratio. It must be filed within 30 days of incorporation.

13. How many partners are required to form an LLP?

A minimum of two partners is required, and there is no maximum limit.

14. Can an LLP have a corporate partner?

Yes, a body corporate can be a partner in an LLP by nominating a natural person.

15. What does a designated partner do in an LLP?

A designated partner ensures regulatory compliance, manages legal filings, and represents the LLP officially.

16. What are the duties of designated partners in an LLP?

Designated partners are responsible for compliance, filing documents with the authorities, maintaining records, and ensuring legal responsibilities of the LLP are met.

17. Can a salaried individual be a partner in an LLP?

Yes, provided their employment contract allows it and there is no conflict of interest.

18. Can an LLP own property in India?

Yes, an LLP is a legal entity and can own assets, properties, and enter contracts in its name.

19. Are LLPs required to maintain books of accounts?

Yes, and if their turnover exceeds ₹40 lakhs or capital contribution exceeds ₹25 lakhs, a statutory audit is required.

20. How can a partner exit from an LLP in India?

Through notice as per LLP Agreement or by mutual consent with proper documentation filed with ROC.

21. What is the extent of partners' liability within an LLP?

Partners’ liability is limited to the amount they contribute, except in cases of fraud or negligence.

22. What are the annual compliance obligations for an Indian LLP?

Annual return (Form 11), Statement of Accounts & Solvency (Form 8), and income tax returns must be filed.

23. Is it necessary for an LLP to submit a tax return annually in India?

Yes, LLPs must file income tax returns annually, even if no business was conducted during the year.

24. Can an LLP be converted into a company?

Yes, by complying with the Companies Act, 2013 and following the conversion process.

25. What are the consequences of non compliance for an LLP?

Penalties for LLP and partners, additional fees, and even striking off of the LLP by ROC if filings are not done.

26. How can designated partners be changed in an LLP?

Changing designated partners requires filing forms with the MCA, updating the LLP agreement, and obtaining their consent and DIN.

27. What is the procedure for appointing a partner in an LLP?

Appointing a partner involves amending the LLP agreement, obtaining consent, and submitting forms to the MCA.

28. How does an LLP in India raise funds?

LLPs raise funds through partner contributions, loans, or borrowings from financial institutions, but not via public share offerings.

29. What is the process for changing the name of an LLP?

File a name change application with ROC, pass a resolution, and update the LLP agreement accordingly.

30. Can an LLP be listed on the stock exchange in India?

No, LLPs cannot issue shares and thus cannot be listed on stock exchanges in India.

31. What are the consequences if an LLP fails to submit its yearly returns?

Penalties for non-filing include fines and disqualification of designated partners; the LLP may also be struck off.

32. What tax advantages does an LLP offer compared to a company?

LLPs do not pay dividend distribution tax and partners are not taxed separately on profit share.

33. What are the differences between incorporating an LLP and a Pvt. Ltd. company in India?

LLP has fewer compliance requirements, shared liability among partners, and no share capital; Pvt. Ltd. allows equity funding and has stricter governance.

34. What are the differences between LLP and OPC Registration in India?

LLP needs at least 2 partners, while OPC is for single entrepreneurs. LLP is better suited for partnership-based operations.

35. What are the differences between LLP & partnership registration in India?

LLP provides limited liability and legal recognition, whereas partnerships expose partners to personal liability and fewer compliance frameworks.

36. What is the procedure for changing an LLP's registered office address?

File Form 15 with MCA, update the LLP Agreement if required, and pass a partner resolution for the address change.

37. How are profits divided in an LLP?

Profit allocation is defined in the LLP Agreement. If unspecified, profits are distributed equally among all partners.

38. Can a partner in an LLP be held personally liable?

No, partners are not personally liable except in cases of fraud or intentional misconduct.

39. Is an LLP a good choice for Startups?

Yes, for startups focused on operational flexibility and lower compliance. However, Pvt. Ltd. is better for raising funds.

40. How should conflicts among partners within an LLP be resolved?

Conflicts should be resolved as per terms in the LLP Agreement, often through mediation, arbitration, or mutual discussion.

41. Can an LLP issue shares?

No, LLPs cannot issue shares. They raise capital through partner contributions or loans.

42. What is the process of transferring ownership in an LLP?

Ownership is transferred by amending the LLP Agreement and re-allocating partner contributions and rights.

43. Are audits for all LLPs operating in India?

No. Audits are required only if turnover exceeds ₹40 lakhs or partner contribution exceeds ₹25 lakhs.

44. Can LLPs operate as non-profit activities in India?

No, LLPs are not meant for non-profit purposes. They must operate commercially and are taxed accordingly.

45. What are the Know Your Customer (KYC) requirements for LLP partners in India?

KYC requires submission of PAN, Aadhaar, address proof, and other identity documents as prescribed by the MCA.

46. Is it possible for a minor to become a partner in an LLP?

No, minors cannot be partners in an LLP. However, they may be beneficiaries through guardianship structures.

47. Are LLPs permitted to engage in manufacturing activities within India?

Yes, LLPs can undertake manufacturing activities provided all required licenses and compliances are met.

48. Can an LLP partner also be a creditor of the LLP?

Yes, a partner can lend money to the LLP and act as a creditor under agreed terms.

49. Is it necessary to have a physical office to register an LLP?

Yes, a registered office address is mandatory for incorporation and receiving legal communication.

50. Can an LLP be formed for professional services in India?

Yes, LLPs are widely used by professionals like lawyers, architects, accountants, and consultants due to their structure and flexibility.

51. How can changes be made to an LLP Agreement?

All partners must agree to changes, and the revised agreement must be filed with the ROC within 30 days.

52. Can an LLP merge with another company or another LLP?

An LLP can merge with another LLP, but not with a company. Approval from the Tribunal and ROC is required.

53. What are the borrowing limits for a Limited Liability Partnership (LLP)?

There is no statutory borrowing limit. Borrowings must be defined and agreed upon in the LLP Agreement.

54. What are the annual filing fees required for an LLP?

Annual fees vary based on capital contribution, usually ranging from ₹50 to ₹5,000 plus late fees if applicable.

55. How should conflicts of interest be handled within an LLP?

Conflicts must be addressed transparently and as per terms laid out in the LLP Agreement.

56. What happens if there is a vacancy in a designated partner position or if a designated partner is not appointed?

The LLP must appoint a new designated partner immediately to avoid penalties and maintain compliance.

57. Is it permissible for an LLP to invest in stocks and mutual funds?

Yes, if mentioned in the LLP Agreement and compliant with SEBI and FEMA guidelines.

58. How to ensure legal compliance in an LLP?

Regular filings, annual returns, audits (if required), legal advisory, and record maintenance are key.

59. What are the implications of a partner's death in an LLP?

The LLP Agreement governs the consequences, including continuation or dissolution based on terms defined.

60. How long does it take to register an LLP in Delhi?

Typically, it takes 15–20 days depending on document readiness and MCA processing.

61. What are the primary requirements for LLP registration in Mumbai?

A minimum of 2 partners, a registered office address, DSCs, and DINs for partners are required for LLP registration in Mumbai.

62. Is it necessary to have a registered office in Pune for LLP registration in Pune?

Yes, a registered office in Pune is mandatory to receive official communication and comply with MCA norms.

63. What are the yearly compliance requirements for an LLP in Bangalore?

Filing Form 11 (Annual Return), Form 8 (Statement of Accounts), and ITR annually. Additional local compliances may apply.

64. Do LLPs in Hyderabad receive any tax benefits?

Yes, similar to other cities, LLPs in Hyderabad benefit from no dividend distribution tax and no tax on profit distribution.

65. What is the minimum capital needed for forming an LLP in Kolkata?

There is no minimum capital required. Contributions can be tangible, intangible, movable, or immovable assets.

66. How can I verify the status of my LLP registration in Chennai?

Use the MCA portal (www.mca.gov.in) and enter your LLPIN or name to check registration status online.

67. What advantages does registering an LLP in Goa offer?

Benefits include lower compliance, tax perks, ease of ownership transfer, and business-friendly policies.

68. How long does it usually take to establish an LLP in Thane?

It generally takes 15–20 business days, depending on document readiness and government processing.

69. What tax incentives come with registering an LLP in Gujarat as opposed to a company?

LLPs in Gujarat enjoy DDT exemption and flexibility in profit distribution but cannot carry forward losses under certain conditions.

70. Are LLPs required to hold annual meetings like companies?

No, annual meetings are not mandatory. However, the LLP agreement may include internal meeting provisions.

71. Is it possible for an LLP to include an entity as a partner?

Yes, body corporates can be partners by nominating individuals to act on their behalf in the LLP.

72. What happens if one does not follow the terms of the LLP Agreement?

Breach of LLP Agreement can lead to penalties, legal action, or dissolution, depending on agreement clauses.

73. What role does the Registrar of Companies (ROC) play in registering an LLP?

The ROC processes name approvals, incorporation forms, LLP agreements, and maintains LLP records.

74. How is the process of dissolving an LLP carried out in India?

It involves partner resolution, ROC filing, debt clearance, and asset distribution as per legal and agreement terms.

75. What are the steps involved in closing down an LLP in India?

Close bank accounts, pay dues, pass partner resolution, file Form 24 with ROC, and get approval for name strike-off.

76. How should one manage an LLP's insolvency?

Insolvency should be handled as per the Insolvency and Bankruptcy Code (IBC) including filing for voluntary or creditor-led liquidation.