Incorporation of Limited Liability Partnership (LLP)

Incorporation of Limited Liability Partnership (LLP) | Steps, Process, Features and Precautions

Incorporation of Limited Liability Partnership (LLP): Limited liability partnership or LLP is a corporate and legal entity that is a separate entity from its partners. The LLP enjoys the status as a separate legal entity only after the incorporation.

Upon successful LLP registration, the LLP can hold, acquire or dispose of all kinds of assets and holds the right to sue others and can be sued in its name.

The prerequisites for the incorporation of a new Limited Liability Partnership are the provisions relating to the registered office of the LLP and the changes therein. The provisions relating to the approval, reservation of name and changes therein are also included.

You can acquire a brief comprehension of the Incorporation of the LLPas you go further.

Steps for Incorporation of LLP

The transition of the LLP Rules, 2009, to the LLP Second Amendment Rules, 2018,  resembles the phase of shifting from your old house to a new one. All the provisions about Incorporation of LLP are changed as per the new LLP Amendment Rules, 2018.

Process Of Incorporation Of LLP

Step – I: Application for the Name Approval:

The first step in the process is the application of the name approval. Here is the six-step for the name approval-

MCA Website Login

All applicants have to login into the MCA account on the official website. Pro-existing users can make use of their earlier account while the new users will have to create a new account.

After successful login, users must click on the ‘RUN’ icon on the MCA service. All the applicants must fill in the necessary information on the online application form. Note that the Application form cannot be downloaded.

Users must remain aware that since October 2, 2018, the e-form LLP-1 has been omitted from the LLP Act, 2008.

Details Regarding The Online Form

  • Entity type Limited Liability Partnership
  • LLPIN: The LLPIN has to be entered only when an existing enterprise wishes to change its name and makes use of the RUN to reserve a new name
  • The proposed name
  • Comment to mention the objects of the proposed Limited Liability Partnership and any other relevant information Like TradeMark etc.
  • Choose any attachment file

Choosing Of The File:

This option is available to upload all the necessary PDF documents. If the applicant wants to attach any file, they can be uploaded making use of this option.

Submission of Form:

After the successful completion of the above three steps, the applicant shall submit the Form on the MCA website.

Payment of Registration Fees:

The MCA website provides no option of paying later in the RUN. Applicants have to pay the registration fees immediately after the successful submission of the form. After successful payment, the challan shall be generated.

Validity of the Reserved Name:

The reserved name after the completion shall be valid for 20 days from the date of approval of the name.

Step – II: Document Preparation for the Incorporation of LLP

After approval of name or for Incorporation of Limited Liability Partnership, the applicant has to prepare the following documents for successful approval-

  • Proof of the office address, whether it was a conveyance or the lease deed or the rent agreement etc. along with rent receipts
  • Copies of all the utility bills not older than two months
  • No Objection Certificate or NOC from the property owner
  • Digital signatures of all the designated partners
  • The Subscriber Sheet which includes the consent
  • Copy of approval in case the proposed name contains any word or expression that requires approval from the Central government
  • If the designated partner does not have a DIN, it is mandatory to attach the two documents- proof of identity and the residential address of the subscribers
  •  Details of Limited Liability Partnership and the company in which partner or the designated partner is a director or a partner

Step – III: Filling of the Form

Once all the above-mentioned documents or information are available or successfully uploaded, the applicant has to fill the information in the e-form known as ‘FiLLiP’.

Features of the FiLLiP Form

An individual or the person can also apply the name in the FiLLiP form. The application of the PAN or the TAN number is a must or a compulsory category for all the fresh incorporation applications filed in the new version of the SPICe form.

Single Window Form:

Before the inception of the Single Window, a person who wanted to incorporate an LLP, could apply for the DIN and get the approval of the name availability as a separate form for the registered office address, etc. But the FiLLiP form is a single-window for the Incorporation of a Limited Liability Partnership.

The FiLLiP form is used for three main purposes-

  • Application of the DIN number
  • Application for the Availability of Name Approval
  • No need os a separate LLP annual filing form for the registration of the address of the office

Step – IV: Submission of FiLLiP on the MCA Website

Once the FiLLiP form is ready with the applicant, the form must be uploaded on the MCA website and proceed further to make the payment of the same.

Step – V: Certificate of Incorporation

The incorporation certificate shall be generated by the LLPIN after the successful completion of the above steps.

Step – VI: Preparation of the Limited Liability Partnership (LLP) Agreement

After the Incorporation of a Limited Liability Partnership (LLP), the partners have to execute the LLP Agreement.

The Limited Liability Partnership (LLP) Agreement shall be executed on the stamp paper. The amount of stamp paper is one percent of the capital of the Limited Liability Partnership. The LLP Agreement shall be filed in e-form LLP-3.

Precaution To Be Taken By The Professionals

There are two precautionary methods to be taken to prevent issues.

  • Obtain engagement letter from the partners- As per the certification in the FiLLiP e-form, the professional must state a declaration that he or she has been engaged for certification. Therefore it is highly advisable to obtain an engagement letter from the partners.
  • Ensure all attachments are clear enough to read- As per certification on the FiLLiP e-form, professionals must state a declaration that all attachments are completely and legibly attached.

Leave a Comment

Your email address will not be published. Required fields are marked *