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  • 2 Partners, 1 LLP Agreement, 1 PAN Card, 1 TAN Card

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  • What is a Limited Liability Partnership?
  • Minimum Requirement to form a Private Limited Company?
  • Steps to form LLP?
  • What are the Advantages of an LLP?

One of the Most preferred organisation is Limited Liability Partnership because it is a combination of benefits of both partnership firm and company as a single form of organisation.

It is regulated by Limited liability Partnership Act, 2008 and the concept of LLP was also introduced in the year 2008.There must be at least two partners to incorporate an LLP. However, in LLP maximum number of partners can be unlimited.

Among the partners of LLP, two individuals must be designated partners and from them at least one should be resident in India. LLP agreement will govern the rights and duties of designated partners. Their responsibilities will be to comply with all the provisions of the LLP Act, 2008 and provisions specified in the LLP agreement.

  1. Minimum Two People: The minimum number of partners required to register LLP must be 2. However, there is no limit on maximum number of partners in LLP.
  2. No Minimum Capital: There is no limit on Capital contribution made by partners in LLP. It totally depends on the need of the business and contribution made by the partners in LLP.
  3. Resident Person requirement: In LLP out of two designated partners, one must be resident of India.
  4. Unique Name: Every LLP for registration has unique name that means it should not be similar with the already registered LLP.

Step 1: Issue of Digital Signature Certificate (DSC)

Firstly, it is mandatory for all the partners of LLP who is authorised to sign the important documents to get his Digital Signature Certificate online. Digital signatures are mandatory to file the forms on the MCA portal. Important documents required for DSC issuance are - Photo, ID and Address proof.

Step 2: Name Approval

Every LLP for registration has unique name that means it should not be similar with the already registered LLP. The name needs to get approved by applying Form LLP_FiLLiP (eForm-2) simultaneously with application for LLP registration.

Step 3: Registration Certificate of LLP

After allotment of DSC and Name approval of LLP incorporation documents are submitted to MCA for registration of LLP. After satisfying with the documents the Registrar will issue the certificate of incorporation.

Step 4: LLP Agreement filing with Registrar

After getting LLP incorporated, the partners of the LLP must enter into an LLP Agreement with ROC and file it with the ROC within 30 days from the date of Incorporation. If LLP Agreement not submitted on time it will lead to a penalty of Rs. 100 for each day of delay.

Step 5: Application for PAN & TAN of LLP

PAN & TAN is required to be taken for smooth running of the business.

Step 6: Bank Account opening Support

An LLP must have a current account in its business name, to do the transaction of business.

A. Separate legal entity

An LLP is a separate legal identity in the court of the law, meaning assets and liabilities of the business as well as assets and liabilities of the partners would be count differently. It means in case of any Loss property of business and the partners will be used differently.

B. Limited liability of the partners

The partners of the LLP have limited liability that means they are liable only to the extent of contribution made by them. This means that they are not personally liable for any loss in the business. If an LLP becomes insolvent at the time of winding up, only the LLP assets are liable for clearing its debts that means no liability of partners.

C. Low cost and less compliance

The cost incurs in forming an LLP is low in comparison with cost incurred in incorporating a public or private limited company. The compliances’ part to be followed by the LLP is also low. The LLP needs to file only two statements annually, i.e., Annual Return and a Statement of Accounts and Solvency.

D. No requirement of minimum capital contribution

LLP can be formed without any contribution made by the Partners. There is no requirement of having a minimum paid-up capital before at the time of incorporation.

  • Documents required to form an LLP?
  • What is the time required to register an LLP?
  • Annual Compliances for in case of LLP?

1.Documents of Partners

  1. PAN Card/ ID Proof of Partners

It is required for all the partners of LLP to provide their PAN at the time of registering with LLP. It is the primary identity proof.

  1. Address Proof of Partners

Partner can submit any one document out of Voter’s ID, Passport, Driver’s license or Aadhar Card for Address Proof. All details of partners as per address proof and as per PAN Card should match, in case If the spelling of own name or father’s name or date of birth is different in address proof and PAN card, it should be corrected before submitting the document to ROC.

  1. Residence Proof of Partners

Latest bank statement/bank passbook, telephone bill, mobile bill, electricity bill or gas bill should be submitted as residence proof. Such bill or statement shouldn’t be older than 2-3 months.

  1. Photograph

It is necessary for every partner to provide their passport size photograph. The White background is preferable on Photograph.

Note: Passport (in case of Foreign Nationals/ NRIs) –In case if Foreign Nationals/NRIs want to become a partner in Indian LLP it is necessary for them to submit their passport compulsorily in addition to address proof that can be a driving license, bank statement, residence card or any government-issued identity proof containing the address.

2. Documents of LLP

1)Proof of Registered Office Address: Proof of address of registered office can be submitted either at the time of registration or within 30 days from the date of incorporation of LLP.

2)In case, If the registered office is taken on rent: In Case LLP Formation is on Rented Property, following additional documents required:

a) No-Objection letter from the Owner of Property to use his Property for Company Formation.

b) For Address Proof of Owner

  • Electricity Bill, Telephone Bill (Fixed Line Only), Gas Bill or Water Bill (Not older than 2 months); - must be in the name of Owner and must be attested by him as well.

3)Digital Signature Certificate: For the purpose of signing all the documents digitally, one of the designated partners needs to opt for a digital signature certificate.

The Whole process of LLP formation takes around 10 days starting from allotment of DSC to Filing Form 3, subject to departmental approval and respond from the respective department.

The first Compliance of partners of LLP is to maintain proper books of accounts of Limited Liability Partnership and make sure that annual return filed on timely basis.

Limited Liability Partnerships are required to audit their books of account only when their annual turnover is above Rs.40 lakhs or if the contribution is above Rs.25 lakh. In other case, an LLP is not required to get their books of account audited.

Statement of Account & Solvency to be filed by LLP on or before October 30th of next financial year and Annual Return on or before 30th may of next financial year.

Statements of Accounts and Solvency

All enrolled LLPs are required to maintain their books of accounts at one place and fill all the required data with respect to the profit made, and other financial information in regards to business, and submit it in Form 8, every year. In Form 8 signatures of designated partners must be there and should also be certified by a practising-chartered accountant or a practising company secretary or a practising cost accountant. If Statement of accounts & solvency report not filed within the specified due date it will lead to a fine of Rs.100 per day. The due date to file form 8 is October 30th of next financial year.

Filing Annual Return

Form 11 is prescribed to file the Annual Return, the due date of which is 30th may of next financial year. This form contains the summary of management affairs of LLP, like numbers of partners along with their names.

Filing and Audit requirement under Income Tax Act

As discussed earlier, Limited Liability Partnerships whose annual turnover is above Rs.40 lakhs or contribution is above Rs.25 lakh are required to get their books of account audited by practising Chartered Accountants under the Limited Liability Partnership Act, 2008. The due date to file the tax return for an LLP, in case if their books of accounts are audited is September 30th of next financial year.

Note: The threshold limit of Rs.1 crore for a tax audit is increased to Rs.5 crore with effect from AY 2021-22 (FY 2020-21) if the taxpayer’s cash receipts or cash payments are limited to 5% of the gross receipts or turnover or 5% of the aggregate payments under the Income Tax Act, 1961.

For LLPs who is not required to get their books of accounts audited, the due date for tax filing is July 31st. Practicing Chartered Accountant must certify this tax filing form. Limited Liability Partnerships who are required for audit can do their tax filing by 30th November. Form ITR 5 is used for LLP. For the purpose of filing this form designated partner’s digital signature should be used.

LLP FAQ’s

Yes, by complying with the provision of clause 58 and schedule II of LLP Act an existing partnership firm can be converted into LLP. For the purpose of conversion and incorporation of LLP Form 17 is required to be filed along with Form 2 for such conversion.

Yes, by complying with the Provisions of clause 58 and Schedule III and IV of the LLP Act any existing private company or existing unlisted public company can be converted into LLP. Form 18 is required to be filed with the registrar along with Form 2 for such conversion.

No, conversation is possible only in case private company or unlisted public company.

In case if the already filed conversion application is marked as ‘Sent for re-application’, the applicant is required to file fresh application in Form 17 or 18 along with Form 2 within 60 days, in case if reapplication is not made within time, Form will be marked as ‘Rejection confirmed’ by the system. However, in case of re-application, the fee is not required to be paid.

Once the name is approved for LLP, it shall be valid for a period of 3 months from the date of approval. If the proposed LLP not incorporated with the approved name within such period, the name shall be lapsed and further cannot be used. Please note that there shall not be any provision for renewal of the name.

No, name of the LLP cannot end with the words like ‘Limited’ or ‘Pvt. Limited’, it shall end with either ‘Limited Liability Partnership’ or ‘LLP’.

Yes, by filing Form 27 Foreign LLP can establish a place of business in by giving the particulars of incorporation of foreign LLP along with details of DPs/ partners of that foreign LLP and details of at least two authorised representatives in order to comply with regulation of LLP act.

If an LLP is incorporated after the 1st of October of the current year let say 1 October 2020, then the LLP can file its annual return for a period of six months i.e., up to 31 March 2021 or for a period of eighteen months i.e., up to 31 March 2022 as per their choice.

Due date for filing Form 8 is 30th of October of next Financial Year. In case if Form 8 not filed within due date it will lead to a penalty of Rs.100 per day of default.

Form 8 is a Statement of Account and Solvency which define the financial transactions undertaken by the LLP during the financial year and also the financial position of LLP during the year. Further additional information required to be provided along with Form 8:

a. The turnover, whether it is more than or less than Rs 40 lakh.

b. It must also declare that whether in any previous year it has filed a statement indicating the creation of charges/modification/satisfaction and also related to the current financial year.

c. Also, declare that the partners/authorized representatives is responsible in preparing books of accounts and also responsible for their proper maintenance.

Following are the documents to be attached with Form 8:


a. It is mandatory to disclose under Micro, Small and Medium Enterprises (MSME) Development Act, 2006.


b. In case if any contingent liability exists statement of the same to be attached.


c. Any other relevant document can be attached optionally.

If the total turnover of the LLP is less than or equal to Rs 40 lakh or partner’s contribution is less than or equal to Rs 25 lakh, Form 8 must be digitally signed by a minimum of two Designated Partners of LLP or Authorised Representatives of Foreign. In case the total turnover of the LLP exceeds Rs 40 lakh or partner’s contribution exceeds Rs. 25 lakhs, then it is mandatory to certify Form 8 by the auditor of the LLP/ FLLP.

Form 11 due date is 31 may of next financial year. If Form 11 is not filed within due date, then Rs 100 will be levied as a penalty per day for default.

Form 11 is a statement in which all information of partners and their respective contribution is to be given. Additionally, the LLP also needs to provide information about those companies or LLPs in which the partners of LLP hold a similar position. Contribution declared in form 8 should be match with the declaration made in form 11.

Form 11 can be authorised by affixing the digital signatures of the designated partner only when the turnover is up to Rs 5 crores and the total partner contribution is up to Rs 50 lakh. However, if the turnover is above Rs.5 crores and the total partner contribution is above Rs 50 lakh, then Form 11 needs to be certified by a Company Secretary in full-time practice.

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