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Partnership To Limited Liability Partnership


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Online Partnership To Limited Liability Partnership Starts at Rs. 14887.00 / -
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About Partnership To Limited Liability Partnership

Limited Liability Partnerships have an upper hand over the general partnership structure as it is much more beneficial for the partners involved. LLP is a separate legal entity with compulsory registration with the central government, which is not the case with the partnership. It is a business structure that integrates the advantages of the company’s corporate structure and the flexibility of the partnership, i.e. for organizing their internal composition and operation as a partnership. Therefore conversion of partnership firm into LLP is a good business decision to secure the partners’ rights and limit their liabilities

Benefits

Limited Liability of Owners

The liability of Partners is limited to an extent of capital contribution as agreed by the partners in the LLP Agreement. The loss or debt of LLP cannot be assigned to partners even at liquidation. Further, one partner is not held responsible for the actions of negligence or misconduct of any other partner.

Separate Legal Entity

The partnership is not a separate legal entity. In case if the partner(s) dies or retires or in any other case has to leave the firm, the partnership ceases to exist. In this case, a new partnership has to be formed; but this is not the case with a limited liability partnership. Limited liability partnership is a separate legal entity.

Tax Benefits

LLP saves the Dividend Distribution Tax, Minimum Alternative Tax, and Income Tax because interest and remuneration are paid to partners as a salary that is payable to directors.

Raising Capital

Raising Capital is easier in the LLP structure as it allows a limited partner to participate without taking on any accountability, unlike the general partnership where all common partners have unrestrained liability.

Documents Required

Copy of PAN Card of the Directors

Passport size photograph of Directors

Copy of Aadhar Card/ Voter identity card

Copy of Rent agreement(If rented property)

Electricity/ Water bill (Business Place)

Copy of Property papers (If owned property)

Landlord NOC (Format will be provided)

Minimum Requirements

Up to date filing of Income tax returns.

The partners shall receive consideration only by way of allotment of shares in LLP.

Consent of all the unsecured creditors for the proposed conversion in LLP.

Minimum 2 Partners.

At least 1 of the designated partners shall be an Indian Resident.

DPIN for all the Partners.

DSC for all the Partners

There has to be some sort of contribution from each partner.

Process

Frequently Asked Questions

The partnership is required to consist of the same partners that were present in the original Partnership and in the same proportion in which their capital accounts stood in the books of the Firm on the date of conversion. Therefore, the LLP cannot have more or less partners than the extant Partnership Firm, and any changes in the number of partners can be made only after conversion into the LLP.

LLP name is reserved through an online form. In accordance with the prescribed regulations, the partners can provide a maximum of 6 names in preferential order to reserve any one. The Registrar may ask to re-submit the application with a different name if given names do not fall under criteria of uniqueness, relevancy or do not fulfill the other requirements.

No. There is no minimum amount prescribed to form an LLP. It can start off with any amount of capital demanded by the business. Although there is no minimum requirement, every partner must make a contribution to LLP. The amount of capital contribution is disclosed in the LLP Agreement and amount of stamp duty to be paid is decided by total contribution amount.

Director Identification Number is a unique number assigned by the Ministry of Corporate Affairs to Individuals on application made which allows any individual to be a Director in any Company or Designated Partner in LLP. Further, the concept of DPIN (Designated Partner Identification Number) does not persist anymore with respect to incorporation of LLP.

To effect any changes in the Limited Liability Partnership, the Partners shall pass the resolution at the meeting of Partners as required by the LLP Agreement of concerned Limited Liability Partnership. Further, the resolution shall authorize any of the existing Designated Partner to act on behalf of the LLP and its Partners. Also, the authorized partners shall also hold a valid DSC to file the application to Registrar. As soon as the partners execute the Supplement Agreement for a change of partner or their respective designation, an application shall be filed with MCA to approve the changes of a partner or the designation

There are no limitations in terms of citizenship or residency to be a Partner. Therefore, the LLP Act, 2008 allows Foreign Nationals, including Foreign Companies & LLPs to incorporate LLP in India; provided at least one Designated Partner is a resident of India. However, the person should be of age 18 years or above i.e. not a minor and competent to enter into a contract. Also, the proposed Designated Partner shall have DIN.

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