Limited LiabilitybThe members of an LLP are only liable for a small amount of debt incurred by it. On the other hand, for proprietorships and partnerships, the personal assets of directors and partners are not protected if the business goes bankrupt.
Separate Legal EntityAn LLP is a separate legal entity from the partners in it. It has an uninterrupted existence that follows perpetual succession, i.e., the partners might leave, but the business remains. The terms of dissolution have to be mutually agreed upon for the firm to dissolve.
Flexible AgreementTransferring the ownership of an LLP is also simple. A person can easily be inducted as a designated partner and the ownership switches to them.
Suitable For Small BusinessLLPs having a capital amount less than ₹25 lakhs and turnover below ₹40 lakhs per year do not require any formal audits. This makes registering as an LLP beneficial for small businesses and startups.
Eligibility CriteriaTo be eligible for registering as an LLP, the following criteria must be met: At least two partners are required to form an LLP (no upper limit), If a body corporate is a partner, a natural person must be nominated to represent it, Each partner must have an agreed contribution towards the shared capital, LLP should have an authorized capital of at least ₹1 lakh, At least one designated partner should be an Indian resident.
To register an LLP you need scanned copies of the following documents:
LLP Registration Package Inclusions
Company formation and registration has been made easier with Digitronic. You can easily consult a company secretary through us for all of your compliance needs, including foreign income, FDI, PF, and pensions.