LLP registration in India is done online on the MCA portal under the Limited Liability Partnership Act, 2008. You need at least two designated partners (one resident in India), digital signatures, a registered office and name approval. After incorporation through the FiLLiP form, the LLP agreement must be filed in Form 3 within 30 days.
What is an LLP?
A Limited Liability Partnership combines the flexibility of a traditional partnership with the limited liability of a company. The LLP is a separate legal entity: it can own assets and enter contracts in its own name, and each partner's liability is limited to their agreed contribution. One partner is not personally liable for another partner's misconduct.
LLPs are popular with professional firms, consultancies, family businesses and small service companies that want protection from personal liability without the heavier board and audit requirements of a company.
Who should choose an LLP?
- Professionals such as chartered accountants, architects, lawyers and consultants working together
- Small and mid-sized service businesses with a few owners who manage the business themselves
- Businesses converting from a partnership firm that want limited liability
- Founders who do not plan to raise equity funding soon, since venture investors generally prefer private limited companies
If you expect to issue shares to investors or run an employee stock option plan, a private limited company is usually the better starting point.
Eligibility requirements
- Partners: at least two partners, who can be individuals or body corporates. There is no maximum.
- Designated partners: at least two must be individuals, and at least one must be resident in India (stayed 182 days or more in the preceding year). Designated partners are responsible for compliance.
- DPIN or DIN: designated partners need an identification number, which can be obtained through the incorporation form.
- Registered office: an address in India with proof and owner consent.
- Contribution: no minimum contribution is prescribed. Partners decide the amount and form of contribution.
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Get expert help →Step-by-step LLP registration process
- Get digital signatures for all designated partners.
- Reserve the name using RUN-LLP on the MCA portal. The name must end with LLP or Limited Liability Partnership and must not conflict with existing entities or trademarks.
- File FiLLiP (Form for incorporation of LLP) with partner details, contribution, registered office proof and subscriber consent. Designated partner identification numbers can be applied for in the same form.
- Respond to any ROC queries within the time allowed.
- Receive the Certificate of Incorporation with the LLP Identification Number (LLPIN). PAN and TAN are issued along with incorporation.
- Execute and file the LLP agreement in Form 3 within 30 days of incorporation.
Why the LLP agreement matters
The LLP agreement is the rulebook of the LLP. It sets out each partner's contribution, profit-sharing ratio, rights and duties, admission and exit of partners, decision-making and dispute resolution. If no agreement is filed, the default provisions in the First Schedule of the LLP Act apply, which may not reflect what the partners intended.
The agreement must be stamped as per the stamp law of the state where the LLP is registered. Filing Form 3 late attracts additional fees for each day of delay, so it should be prepared alongside the incorporation application.
Cost and timeline
Government fees for LLP incorporation are modest and depend on the partners' total contribution. Other costs include digital signatures, stamp duty on the LLP agreement (varies by state) and professional fees. With complete documents, an LLP is usually incorporated in about 10 to 15 working days, and the LLP agreement is filed shortly after.
Annual compliance for an LLP
| Filing | Purpose | Due date |
|---|---|---|
| Form 11 | Annual return with partner details | Within 60 days of the end of the financial year (30 May) |
| Form 8 | Statement of Account and Solvency | Within 30 days of six months from year end (30 October) |
| Income tax return | Tax on LLP profits | As per the Income Tax Act deadlines |
Accounts must be audited if turnover exceeds Rs 40 lakh or contribution exceeds Rs 25 lakh in a financial year. Late ROC filings attract an additional fee for every day of delay, which adds up quickly.
Frequently asked questions
What is the difference between an LLP and a partnership firm?
An LLP is a separate legal entity with limited liability for partners, registered with the ROC under the LLP Act, 2008. A traditional partnership firm is governed by the Indian Partnership Act, 1932, is not a separate legal entity, and its partners have unlimited personal liability for the firm's debts.
Can an LLP raise funding from investors?
An LLP can admit new partners who bring in capital, and foreign investment is permitted in sectors allowed under the automatic route. However, an LLP cannot issue shares, so venture capital and angel investors generally prefer to invest in private limited companies.
Is audit compulsory for every LLP?
No. An LLP needs a statutory audit only if its turnover exceeds Rs 40 lakh or its partners' contribution exceeds Rs 25 lakh in a financial year. Tax audit rules under the Income Tax Act apply separately based on turnover and profits.
How long does LLP registration take?
An LLP is typically incorporated in 10 to 15 working days once digital signatures are ready and the name is approved. Name rejections and incomplete registered office documents are the most common causes of delay. The LLP agreement must then be filed within 30 days.
Can a private limited company convert into an LLP?
Yes. A private limited company can convert into an LLP by filing the prescribed forms with the ROC, provided there are no security interests outstanding on its assets and all partners of the proposed LLP are shareholders of the company. Tax neutrality conditions apply for the conversion.
What happens if an LLP does not file annual returns?
Late filing of Form 8 and Form 11 attracts an additional fee for every day of delay, and the designated partners can face penalties. Continuous non-filing can lead the ROC to strike off the LLP, which then requires a restoration process.
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