Limited Liability Partnership is a legal entity registered with the Registrar of Companies under the Limited Liability Partnership Act, 2008. This entity is regulated by the Ministry of Corporate Affairs. It is a combination of a Partnership firm and a company. LLP is a partnership but it enjoys almost all the features of the company, and these are:
Separate Legal Entity : The LLP has a separate and distinct entity from its partners as the company has from its shareholders. The partners and LLP are different from each other, the identity of the LLP doesn’t get affected by the change of the partners.
Limited Liabilities : All the partners of the LLP are having limited liabilities whereas in the partnership firm all the partners having unlimited The partners are not personally liable for any debt or loss incurred by the LLP. They are only responsible for such amount which they agree to contribute as mentioned in the LLP agreement.
On Its Name : The LLP can buy or sell the property on its name and also sue or be sued by any person on its name and also get entered into any contract or agreement with any other person under its name.
LLP is a separate legal entity from the co-workers. Each associate can sue the other in case a situation occurs. It has an unbroken existence that follows regular succession, i.e., the partners might leave, but the company remains. A term of resolution has to be mutually agreed on for the firm to dissolve.
Transferring the title of LLP is also simple. A person can quickly be inducted in as a nominated partner and the ownership switches to them.
LLPs having a capital amount of fewer than 25 lakhs and turnover below 40 lakhs per year do not need any formal audits. It makes the listing as LLP useful for small companies and startups.An LLP can own or take property because it is identified as a juristic person. Associates of LLP cannot claim the property as theirs.
An LLP has associates, who own and operate the business. This is different from a private limited company, whose executives may be different from stockholders. For this reason, VCs do not invest in the LLP structure.
The method of LLP registration in India does not require much legwork when it comes to documents.
To Be Submitted By Partners
Note : Any one of the partners must self-attest the first three documents. In the case of foreign nationals and NRIs, all the documents must be notarized (if currently in India or a non-Commonwealth country) or apostilled (if in a Commonwealth country).
For The Registered Office
Note : Your registered office need not be a commercial space; it can be your residence, too.
Any business who has :.
The LLPs will also be permitted to opt for downstream investment in a different company or even choose LLP in those sectors which allow 100% FDI following the automatic route. This does not come up with any performance constraints that are FDI linked.
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