Limited Liability Partnership (LLP)Â form of business organization is getting recognition all over India and now LLP can be easily formed and incorporated under the Limited Liability Partnership Act, 2008. LLP combines the advantages of running a Partnership Firm and separate legal entity status and limited liability aspect of a Company. Separate Legal Existence: At the very outset LLP is a body corporate and is a legal entity separate from that of its partners and unlike companies shareholders, the partners/designated partner of the LLP have the right to manage the business directly. Company Law Compliances:
- LLP is totally cost effective from the perspective of cost involved and also from compliance point of view compared to private limited company. The process for incorporating a LLP is a three â€“ way step:
- Obtain DIN and digital signature certificate of partners and designated partner
- Â Name approval of the LLP and a drafted LLP Agreement
- File all the documents of incorporation along with the LLP agreement to Registrar of Companies (ROC) and obtain the Certificate of Incorporation
Moreover, LLP having contribution less than Rs. 1 lakh can be incorporated by paying fees of Rs. 750 only which is comparatively lower than the private company incorporation fees.
- LLPs have fewer requirements as to compliances related to meetings and maintenance of huge statutory records and as a result LLPs have not to incur huge cost to maintain such records and maintenance of the same compare to Companies.
Audit Requirements: Moreover, unlike private limited company audit is not mandatory to LLP unless capital exceeding Rs. 25 lakh or turnover exceeding Rs. 60 lakh. Hence, LLP is cost effective as you donâ€™t have to invest in appointing auditors, space and equipments for audit purpose.
Taxmantra.com will assist you in all Business Incorporation & Maintenance issues including Creation of LLPs, Companies etc and also in post incorporation issues such as assistance in other registrations, ROC Compliances and others.