Why Not Choosing A Mid-way? Choose LLP As Your Business Form
Most of the entrepreneurs get confused with which business is suitable for them. They do not want to take a big step like Private Limited because of the legal expenses and compliances and they also do not want to go for small setup like Proprietorship or partnership because of its non- recognition. This confusion leads to wasting of precious time of entrepreneurs. Entrepreneurs who are not willing to take a big step like incorporation of Private Limited or Small setup like Proprietorship or Partnership, can go for a Mid-way i.e., Incorporation of LLP.
Limited Liability Partnership (LLP) was introduced in India through Limited Liability Partnership Act, 2008. The primary concept for the introduction of Limited Liability Partnership is to provide a kind of legal and financial entity, which is simple and offers limited liability to the owners for the LLP’s debts.
The most amazing advantage of the limited liability partnership firm as compared to traditional partnership firm is that one partner is not liable for the wrong doings of another partner of the LLP.
Minimum two people can form an LLP with no maximum limit on the number of its partners. The other advantage of LLP form of business over a private limited is in the fact that there is less compliance requirement in comparison to a private limited company. For instance, an audit is not required till the time turnover reaches 40 lac or capital reached Rs. 25 lac. This is preferred choice for small businesses with less capital and startups.
- Minimum Two Person
- At least one Designated Partner is Indian Resident
- Registered office address in India
- Name Reservation of LLP
- Obtaining Digital Signatures
- Document Submission to ROC
- Obtaining Certificate of Incorporation
- Filing of LLP Agreement with ROC
- Limited Liability Protection
- No Audit Requirement till certain limit
- Less compliance and expenses
- Perpetual Secession
- Better image and credibility
- Legal Recognition
- Self-Attested Copy of Adhaar card and PAN Card of the Partners.
- Passport size photograph of the designated Partners.
- Email ID’s, Phone Number, Mobile Number and Qualification of all the Partners. Registered office address proof –
- Copy of Rent Agreement/ Sale Deed/ Conveyance Deed/ Registry of the Property
- Copy of Electricity Bill (not older than 2 months)
- NOC, if owned by other person
- Breakup of the capital contribution is required
- Profit sharing ratio among the partners shall be specified