LLP Registration Online – An Overview
Limited Liability Partnership (LLP) in India took shape after January 2009, making it an instant success with startups and professional services. Limited Liability Partnership Registration, governed by LLP Act 2008 combines the benefits of a partnership with that of a limited liability company. LLP was introduced to provide a form of business that is easy to maintain and to help owners by providing them with limited liability.
For a Limited Liability Partnership registration in India, Legal Registration is one of the most affordable and steadfast service providers.
Why register an LLP company? - Benefits
After deciding on your business model, it's important to choose between the Private limited company registration and LLP, by understanding their differences and advantages they provide, so as to choose what’s best for your business model.
The most vital reason for registering as LLP is the limited liability. The members of the firm are only liable for a small amount of debt incurred by it. This is entirely different from proprietorship and partnership where the personal assets of directors and partners are not protected if the business becomes bankrupt.
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Seprate Legal Entity
- LLP is a separate legal entity from the partners. Each partner can sue the other in case a situation arises.
- It has an uninterrupted existence that follows perpetual succession, i.e., the partners might leave, but the business remains. A term of dissolution has to be mutually agreed on for the firm to dissolve.
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Flexible Agreement
Transferring the ownership of LLP is also simple. A person can quickly be inducted in as a designated partner and the ownership switches to them.
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Suitable For Small Business
- LLPs having a capital amount less than 25 lakhs and turnover below 40 lakhs per year do not require any formal audits. It makes registering as LLP beneficial for small businesses and startups.
- An LLP can own or acquire property because it is recognized as a juristic person. Partners of LLP cannot claim the property as theirs.
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No Owner/Manager Distinction
An LLP has partners, who own and manage the business. This is different from a private limited company, whose directors may be different from shareholders. For this reason, VCs do not invest in the LLP structure.