Limited Liability Partnership
How can you set up a Limited Liability Partnership in India
Starting out alone on a life adventure can sometimes turn out to be risky business, and hence we need partners to get a second perspective on various aspects. Partners will always be there to lend a helping hand in times of need and celebration. In business too, we can find similar patterns.
Limited Liability Partnership (LLP) is a newly introduced corporate entity type in India aimed at entrepreneurs, small and medium sized businesses. An LLP provides many benefits of a Private Limited Company and at the same time it is easier to maintain compliance. Low registration fee and easy maintenance make LLP a first choice for many of the small businesses in India.
Limited Liability Partnership (LLP)
Limited Liability Partnerships, LLP is a unique and new form of business that combines the advantages of both 'Company' and 'Partnership' in a single business entity. This was introduced in India in 2008 with the approval of the Limited Liability Partnership Act, 2008.
LLP is a superior type of partnership. A normal partnership is often discouraged due to its unlimited liability feature, i.e. your personal assets may be seized in case all the dues are not cleared. To counter this problem, an important feature of limited liability of company was added to the partnership, resulting in Limited Liability Partnership.
LLP is a separate legal entity, which can be formed in India by a minimum of two persons coming together with a motive of earning profit. Unlike a Private Ltd Company, an LLP is easy to manage and it is subjected to minimal post registration compliances.
Basic requirements for LLP Formation
1. A minimum of 2 Partners are necessary.
2. If a corporate body is a Partner, it has to nominate a natural person as its Nominee.
3. No concept of share capital exists, but each Partner has to contribute towards LLP capital.
4. DIN (Director Identification Number) mandatory for all the Designated Partners.
5. DSC (Digital Signature Certificate) mandatory for all the Designated Partners.
6. Address proof for office of LLP is required.