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Incorporation Checklist
New Limited Liability Partnership (LLP)
Fact Sheet
A 'LLP' is an body corporate entity registered with the respective Registrar of LLP’s (ROLLP) of the respective
states in which its registered office is located, and all the Registrars offices fall under the administration of the
Ministry of Corporate Affairs, Govt. of India. A LLP is governed by the Limited Liability Partnership Act, 2008, and
the regulations made there under. It has the following characteristics/benefits –
(a) Minimum 2 partners, maximum unlimited, but at least 2 partners shall be designated partners (DP) who shall
be individuals (incl. nominee of body corporate) out of which at least one shall be resident in India with not
less than 50% share. The 2 DP’s shall be responsible for all legal compliance under the LLP Act.
(b) One or more Private Limited Company or another LLP can be a partner in a LLP through its director / partner.
(c) Changes in name, partners, business activity, registered office and other terms can be carried out as desired,
from time to time by filing the required Forms & documents with registrar.
(d) The mutual rights & duties of partners and the administration of the LLP shall be governed by an agreement
or LLP Deed between partners inter-se and/or between the LLP and the partners. In the absence of any such
Deed, the administration of the LLP and its partners shall be governed by the LLP Act & rules.
Comparison of LLP with other business forms
SN Particulars
LLP
1. Liability
of Limited to partner’s agreed
Partners & Firm contribution & not liable for
unknown acts of other partners.
LLP is liable to the extent of its
assets & liabilities only
2.
Flexibility
3.
Statutory
Compliances
4.
Regulation
5.
Existence
6.
More flexibility compared to a
Firm or Company
Old Partnership Firm
Private Limited Company
The Firm, every partner is
jointly & severally liable for all
acts of the firm & its partners
(even the personal assets of
each partner are liable)
Limited to director’s share capital &
not liable for unknown acts of other
directors. Company is liable to the
extent of its assets & liabilities only
Less or no flexibility
More flexibility than Firm
Least and electronically regulated Cumbersome manual process More than a LLP but electronically
to minimise ‘red tape’
with maximum ‘red tape’
regulated to minimise ‘red tape’
LLP Act, 2008
Indian Partnership Act, 1932
Perpetual, irrespective of death or Terminated
on
death
retirement of partners
retirement of partners
Companies Act, 1956
or Perpetual, irrespective of death or
retirement of directors
Separate Entity Separate legal entity independent Not a separate legal entity, Separate legal entity independent
of its partners, hence preferred by hence
not
preferred
by of its management, preferred by
outsiders dealing with the LLP
outsiders dealing with the Firm outsiders
7.
Partners /
Directors
Min – 2; Max – no limit
Min – 2; Max – 20/10
Min – 2; Max – 50 (members)
8.
Functionality
Designated Partners
Acting Partners
Directors
9. Audit & Accounts Audit not compulsory, accounts & Audit and filing of accounts not Audit compulsory, accounts
annual return to be filed
applicable
annual return to be filed
&
Incorporation Process
Time line estimates mentioned below are subject to prompt receipt of details/papers from the client and proper
functioning of Govt. website. The implications of these points & abbreviations are explained on pages below.
Steps
Particulars
Step 1
Obtain a designated partners identification number (DIN) for at least 2 proposed partners, if not all
(ask for our DIN Checklist)
Step 2 Obtain a digital signature certificate (DSC) for any one designated partner (ask for DSC Form)
Application for Approval of Name desired of the LLP. If these names are rejected by Registrar,
Step 3
submit fresh names, or if alterations suggested, carry out suggested alterations & resubmit
No. of Days
1
1
5 – 15
Step 4 Incorporation papers – preparing & electronic uploading of incorporation docs & pay Govt. Fees
1
Step 5 LLP Registration and Certificate of Incorporation i.e. approval by Registrar
3
Submit Partnership Agreement (LLP Deed) – drafting the LLP Deed & upload with eForm3. If
Step 6
corrections suggested by Registrar, carry out these and resubmit
Others Proceed for Tax, VAT, Labour etc., statutory registrations (ask for any of our specific Checklists)
3–6
---
Total timeline 12 – 20 days
Manoj Mehta & Co., Chartered Accountants, Mumbai. Tel: 22005454. Email: mail@manojmehta.com
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Incorporation Checklist
LLP Benefits
(a) Limited Liability – the greatest benefit by far, a LLP being a separate legal entity, the personal assets of its
Partners are not affected for outstanding liabilities/payments to creditors or lenders (except Govt. dues)
provided the partner has not acted fraudulently. LLP is liable to the extent of its assets & liabilities.
(b) Tax Benefits – being a corporate entity, an LLP can claim more tax-deductible costs and allowances from its
profits compared to a sole proprietorship or partnership. Income taxes are passed through the business and
reflected tax free on the partners' individual tax returns (no tax on profit distribution like dividend tax).
(c) Borrowing – can accept loans and deposits from its partners, relatives, banks and even from third parties.
(d) Capital – no minimum partnership capital requirements. Usual default capital is ` 50,000/-.
(e) Activities – can conduct retail, wholesale, trading, manufacturing or services activities, no requirement of
minimum or maximum turnover or employees/workers. The name of the LLP should end with 'LLP'.
(f) Legal & regulatory requirements – simpler as the compliance process is electronic (paperless) & no need to
visit Govt. Dept. or deal with officers. The act provides flexibility to devise the LLP agreement as per choice.
(g) Popularity – convenient form of entity for professional firms like accountants, lawyers, engineers, artists,
sportsmen, film actors or technicians etc., also suitable for Knowledge, Technology (R & D), Patent or Design
enterprises, Philanthropy, Venture Capital Funds, Sahakari Sanstha’s in Agro and Handicrafts sectors.
(h) Real Estate – particularly suitable for real estate & construction firms as distribution of profits to partners tax
free, can accept outside loans, limited liability, simpler compliances and corporate status.
(i) Hybrid vehicle – LLP has elements of both, a corporate as well as a partnership structure, it is called a hybrid
between a company and a partnership and is a very popular structure worldwide and now in India.
(j) Status – a LLP has an enhanced status and aesthetic value in the eyes of local & overseas customers,
clients, banks, creditors, funding agencies and general public.
(k) Acceptability – a LLP is a preferred as a corporate entity for awarding contracts, tenders, empanelment,
providing finance etc., and has a larger image in the perception of the society.
(l) Perpetual Existence – it is an entity with perpetual succession. The members or directors may change from
time to time, but that does not affect the continuity of the LLP.
Checklist – Incorporation of a New LLP
SN Details to be provided against each of the points below
-- Glossary of terms & short forms used in this Checklist
` = Indian Rupees
ROLLP = Registrar of LLP, Mumbai, under MCA
DP = Designated Partner
MCA = Ministry of Corporate Affairs, Govt. of India
DSC = Digital Signature Certificate
LLPIN = Limited Liability Partnership Identification Number
DIN = Designated partner’s Identification Number
LLP Deed = Partnership Agreement / Deed
CIN = Company Identification Number
LLP Act = Limited Liability Partnership Act, 2008 (with Rules)
1. Name, address & contact details of Applicant (applicant can be any one of the partners)
Name
Address
Town / City
State
Tel. No/s
Email
Fax
PIN
Website
2. Have all the partners of this proposed LLP obtained ‘DIN’? ()
Yes
No
DIN is a unique, one time identification no. assigned by MCA to any person wanting to be a Designated Partner (DP)
If, Yes
mention the DIN of each of the proposed DP’s under point ‘8’ below ()
If, No
fill-up our ‘DIN Checklist’ separately for each DP & hand it to us with attachments ()
A Designated Partner shall be responsible for all legal compliance of the provisions of the LLP Act. Any two main
Manoj Mehta & Co., Chartered Accountants, Mumbai. Tel: 22005454. Email: mail@manojmehta.com
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Incorporation Checklist
partners (or even all partners) out the total no. of partners can act as designated partners.
3. Have all the designated partners obtained (DSC)? ()
Yes
No
Digital Signature Certificate or ‘DSC’ is a legally recognised method of signing documents electronically
If, Yes
attach the ‘DSC Tokens (USB)’ or email the ‘PFX’ soft file, with password of all the DP’s ()
If, No
fill-up the ‘DSC Form’ (ask for DSC Form) for all the DP’s and forward it to us with the
attachments specified therein ()
4. Proposed names of the LLP (names desired)
(a) Give upto 6 choices of desired names in order of preference, avoid multiple names if a particular name is strongly
desired (you have to re-apply in case of 1st time rejection). (b) Give significance of the prefix or special words (if any) in
the names. (c) The names should reflect the proposed business activities. (d) Names are subject to approval by ROLLP
a.
b.
c.
d.
e.
f.
The name should comply with the LLP regulations; should not be similar or resemble or have phonetic resemblance, to any existing
registered Company or LLP or should not be offensive, obscene or profane; should not violate IPR or trademarks; should not be a
dictionary or generic word; should not imply patronage of government, royal or kingdom or indicative of a different legal constitution like
society, HUF, firm, Inc., PTE, Gmbh, LLC etc.
5. Whether any word/s in proposed name is registered under If yes, provide registration certificate or receipt or
Trademark or IPR Laws? () Yes ___; No ___
such other evidence of registration.
6. Proposed main objects or business activities, in full detail with description of products, processes,
ancillary or related activities (use separate sheets if space provided is insufficient)
7. A. Office address of the proposed LLP:
B. Proof of Office Address – self certified copies of any one proof like – (a) Property Deed; (b) Govt. Utility
Bill (electric, telephone etc); (c) Bank Statement (1st page & latest transaction page); (d) Passport; (e)
Election or Ration Card etc. (proofs should not be over 2 months old) (tick the Proof provided by you)
If the office is owned by one of the partners or rented / leased then the documents mentioned above shall be
required in respect of the owner of the premises along with owner’s Consent (ask for Consent format).
8. Details of Partners, Capital Contributions & Profit Sharing: (use extra sheets if space is insufficient)
Name of Partner
* Capital
Designated or
Profit Sharing
Contribution (`)
Normal Partner? DIN Number
(%)
a.
b.
c.
d.
e.
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Incorporation Checklist
* the capital contributions should be brought in by the partners within one month of incorporation
9. Whether any Partner of this proposed LLP is a Director in any other Company/s or Partner in any
other LLP/s, details thereof (use extra sheets if space is insufficient)
Other Directorships (Companies) / Partnerships (LLP’s)
Name of Partner
Name of the Company / LLP
CIN / LLPIN No.
a.
b.
c.
d.
e.
10. Do you have any specific instructions or matters which you want included in the ‘LLP Deed’
(indicative points given below)? Elaborate on these or other points, as required on a separate sheet
a. Date of LLP
i. Powers, duties, rights, obligations of partners
b. Addresses of office, factory, branches etc.
j. Admission, removal, resignation, death of any partner
c. Business activities to be carried on, in detail
k. Buy, sell, construct assets, immovable property
d. Term of LLP partnership
l. Accounts, financial year, audit, books/record etc.
e. Capital of LLP with individual shares
m. Indemnification of partners
f. Profit sharing, remuneration, interest etc., to Partners
n. Amendment of partnership deed
g. Bank account/s and mode of operation
o. Legal disputes & arbitration, jurisdiction
h. Meetings of partners, minutes
11. Enclose Cheque / Cash / DD for incorporation costs (you may also make RTGS or NEFT payment)
Have you enclosed the payment? ()
Yes
No
Please send full payment as per points 13 below, as we have to make advance disbursements. Our NEFT
details – Bank of Baroda, Walkeshwar Br.; A/c. No. 06130200000115; IFSC Code – BARB0WALKES
12. LLP Kit – Copies of LLP Deed & Common Seal (these items are optional)
a. Do you want 25 extra printed & bound copies of LLP Deed? ()
Yes
No
` 4000/-
b. Do you require Stainless Steel Common Seal? ()
Yes
No
` 1100/-
13. Indicative chart of Total Incorporation Costs given below (all amounts in `) (service tax shall be extra)
Partnership
Capital
Stamp
Duty
Govt.
Fees
Prof.
Fees
Total
Costs
Partnership
Capital
Stamp
Duty
Govt.
Fees
Prof. Fees
Total
Costs
50000
500
800
17500
18800.00
4 lakhs
4000
2400
1 lakh
1000
800
17500
19300.00
5 lakhs
5000
2400
17500 23900.00
17500 24900.00
2 lakhs
2000
2400
17500
21900.00
10 lakhs
5000
4500
17500 27000.00
3 lakhs
3000
2400
17500
22900.00
Over 10 lakhs
5000
5600
17500 28100.00
Notes: (a) Common examples of partnership capital are indicated above, it can be any rounded amount of your choice. (b)
DSC charges @ 2000/- per designated partner shall be extra. (c) Add to the total costs above, the cost of LLP Kit. (d)
Professional Fees relates to our incorporation services like advising, drafting of LLP Deed, structuring issues, eForm filing etc.
Fill-up the above checklist with clarity and information to the fullest extent without omissions and short forms and
email it to us. Kindly take careful note of the statutory compliances and the related penalties, provided below.
Manoj Mehta & Co., Chartered Accountants, Mumbai. Tel: 22005454. Email: mail@manojmehta.com
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Incorporation Checklist
Compliances & Penalties under LLP Law
(given below are only common examples of compliances, the list is not at all exhaustive)
A.
Regular / Annual Compliances (annual mandatory compliances irrespective of any event) (amounts in `)
SN
Head
Section Compliance / Filing documents with ROC
Penalty for Non Compliance
1. Statement of
Accounts &
Solvency
34(2) LLP to file a Statement of Account & 25,000 upto 5,00,000 on LLP and 10,000 upto
Solvency (annual Accounts) within 6 months 1,00,000 on every designated partner in default
of year end, in eForm8
2. Annual Return
35(1) LLP to file a Annual Return within 60 days 25,000 upto 5,00,000 on LLP and 10,000 upto
of year end, in eForm11
1,00,000 on every designated partner in default
B.
Event Based Compliances (triggered by any specific event)
SN
Head
Section
1.
Change in
Designated
Partners
7(3), Notice of any incoming or outgoing designated 10,000 upto 1,00,000 – on the
7(4), 9 partners to be filed within 30 days, in eForm4. If no. of LLP & every designated partner
designated partner falls below 2, all the other partners who is in default
shall be deemed designated partners.
2.
Change of
Registered Office
13(3) Notice of change in regd. office address to be filed 10,000 upto 1,00,000 – on the
within 30 days, in eForm15
LLP & every designated partner
who is in default
3.
Change of Name
4.
Changes in LLP
Agreement /
Deed
23(2) Notice of changes in the clauses or terms of LLP 5,000 upto 5,00,000 + 50 per day
Deed to be filed within 30 days, in eForm3
– on LLP & every designated in
default
6.
Change in
Partners
25(2) Notice of any incoming or outgoing other partners or 2,000 upto 25,000 – on LLP &
changes in partner’s name, address, contacts, to be every designated partner in
filed within 30 days, in eForm4
default
7.
Books of
Accounts , Audit
34(1) LLP to maintain books of accounts as prescribed & 25,000 upto 5,00,000 on LLP &
get them audit if applicable. Audit applicable if Capital 10,000 upto 1,00,000 on every
exceed 25 lakhs or turnover exceeds 40 lakhs.
designated partner in default
19
Compliance / Filing documents with ROLLP
Penalty for Non Compliance
Notice of change in name of LLP within 30 days, in 5,000 upto 5,00,000 + 50 per day
eForm15
– on & every designated partner in
default
_______________________
(name & signature of client)
Manoj Mehta & Co., Chartered Accountants, Mumbai. Tel: 22005454. Email: mail@manojmehta.com
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