When compared to the other forms of business, LLP or Limited Liability Partnerships are a relatively new form of business model. The concept of Limited Liability partnerships was introduced through the commencement of the LLP Act, 2008. All the rules governing the LLPs including registrations, compliances, modifications, and closure of LLPs, are covered in this Act. Through this article, we will discuss the unique features of limited liability partnerships and the documents required to register a LLP in India.
A Hybrid business model
The most unique feature of a Limited Liability Partnership is that it is a hybrid mix form of business. It has the best of the features of both, a private limited company (such as legal existence) and a partnership firm (such as taxability of firms).
Limited Partner Liability
In this hybrid business model, the partners are only liable up to the extent of their capital or the extent of the amount assigned by them in the subscriber’s sheet. This allows the owners to protect their assets from the loss in business.
Foreign Direct Investment
As per the foreign trade policy (FTP) a 100? Foreign direct investment in Indian LLPs is acceptable. This encourages more foreign partners in LLPs. The foreign partners can either be foreign nationals, or Indian Nationals residing out of India.
No upper limit on Members
Since the name suggests a partnership, you need to have at least one partner to be able to register a LLP in India. However, the benefit is, there is no upper limit on the number of members/partners to a limited liability partnership. Hence, you can make it a close-knit circle of three or you can run a LLP with 50 members. The choice is solely yours!
Now that you are aware of the most unique features of the Limited Liability Partnership business model in India, you can choose if it is the relevant option for you! If it is, and you want to register a LLP in India, you will have to submit a set of documents required by the Ministry of Corporate Affairs (MCA). All the documents required to register a LLP in India are explained below in detail.
Documents required from Indian National Partners
All Indian Nationals who are desirous of becoming a partner in an LLP need to submit the following documents while applying for LLP registration online,
- PAN Card
PAN stands for Permanent Account Number. It is a unique number assigned to each individual over the age of 18 years and is one of the most important unique identification numbers for individuals and entities alike. The Income Tax (IT) department issues the PAN of each individual, upon receiving the application.
- Identification Proof
All proposed partners of a LLP also need to submit their address proof. You can choose any of the following documents to submit as proof of your identification:
- Voter’s ID (Election Card);
- Passport;
- Ration Card; or
- Driver’s License.
- Address Proof/Residential Proof
Proposed partners in a LLP also need to give proof of their residence. Utility bills with updated addresses are the best option to do so. Copy of any of the following utility bills can be submitted:
- Rent Agreement;
- Electricity Bill;
- Telephone Bill; or
- Bank Statement.
Documents required from Foreign National Partners
As stated above, foreign nationals, too, can be a partner of a LLP registered in India. However, the norms of MCA require them to have a certain set of documents ready to be able to own a business in India. The list of documents is as follows:
Passport
This is the most important and mandatory document applicable to foreign directors desirous of becoming partners in an Indian-origin LLP. For foreign nationals, a passport is considered as the primary proof of identification. Hence, if a passport does not hold the date of birth of an individual, another legally valid document is required to verify the age of the proposed foreign national partner. Since this passport is issued in a country outside India, the passport needs to be apostilled/ notarised by the appropriate authority for verification.
Address proof
Apart from the passport, the foreign national partner needs to submit an apostilled or notarised copy of address proof. This document can be as old as one year. A copy of any of the following will do:
- Residential card;
- Driver’s License;
- Bank Statement; or
- Other governmental licenses.
Residential Proof
Once you verify the permanent address, you also need to prove the current residence by providing any residential document as proof. It includes:
- Telephone Bill;
- Electricity Bill; or
- Bank Statement.
Registered Office Address Proof
The registered office is usually the principal place of business and the primary location for all communication and notices to the business. As proof of the registered office, you can submit any of the following:
- Sale Deed;
- Rent Agreement;
- NOC from Landlord;
- Utility Bill (not older than 3 months – electricity, water, telephone, or network connection bills are acceptable).
Subscriber’s Sheet
The most important document that you will submit while filing the FiLLIP is the subscriber’s sheet. Here, the details of all partners along with their capital contribution are mentioned.
Conclusion
Lastly, after the approval of your LLP, you need to submit a duly registered LLP Deed signed and executed by all partners within 30 days of the approval. Once all these submissions are complete, you can start your business operations. LLP registration online in India is quite simple and cost-effective! Get in touch with a professional and start your business today!
