A Limited Liability Partnership is a separate legal entity which hold assets in its nature, where as it is likely to a partnership firm where it is required two members for incorporating the firm with limited liability. Limited liability partnership is an organized for partnership where it is mandatory to get it registrar of companies on online portal of MCA.
Every limited liability partnership shall have at least two partners. If at any time the number of a limited liability partnership is reduced below two and the limited liability partnership carries on business for more than six months while the number is on reduced, the person, who is the only partner of the limited liability partnership during the time
Benefits of One Person Company:
• No minimum capital required.
• It is beneficiary no executive business in LLP as it limits the liability of the members
• It is no compulsory to conduct a board meeting time to time the partners can meet as per their availability and requirements.
• There can be more than two owner in a LLP firm.
• LLP are taxed at a lower rate as compared to Company.
What are the steps to incorporate LLP?
Name reservation: The first step to incorporate Limited liability partnership (LLP) is reservation of name of LLP. Applicant has to file eForm 1, for ascertaining availability and reservation of the name of a LLP business.
Incorporate LLP: After reserving a name, user has to file eForm 2 for incorporating a new Limited Liability Partnership (LLP).
eForm 2 contains the details of LLP proposed to be incorporated, partners’/ designated partners’ details and consent of the partners/ designated partners to act as partners/ designated partners.
LLP Agreement: Execution of LLP Agreement is mandatory as per Section 23 of the Act. LLP Agreement is required to be filed with the registrar in eForm 3 within 30 days of incorporation of LLP.
Can an existing partnership firm be converted to LLP?
Yes, an existing partnership firm can be converted into LLP by complying with the Provisions of clause 58 and Schedule II of the LLP Act. Form 17 needs to be filed along with Form 2 for such conversion and incorporation of LLP.
In case form 17 or form 18 has been filed for conversion of partnership firm/ company into LLP, can conversion application be rejected? Is there any provision for filing an appeal against such rejection?
Yes, conversion application (Form 17 or 18) can be rejected by the registrar, if not found appropriate along with eForm 2.
The applicant has the option to go for appeal against the application rejected within 90 days and inform the registrar about the action undertaken. After the appeal is decided, the registrar can mark the status of eForm as ‘Sent for re-application’ or ‘Rejection confirmed’.
How can I apply for reserving LLP Name?
File LLP Form No. 1 (Application for reservation or change of name) by logging on to the LLP portal along with the fee prescribed and attaching the digital signature of the designated partner proposing to incorporate a LLP.
Also, refer the LLP name availability guidelines prescribed under section-15 read with Rule-18 of LLP Rules, 2009.
Status of my conversion application is ‘Sent for re-application’. Do I need to file the application again? Do I also need to make the payment again?
In case the eForm is marked as ‘Sent for re-application’, the applicant is required to file fresh Form 17 or 18 along with Form 2 within 60 days, failing which the Form will be marked as ‘Rejection confirmed’ by the system. In case of re-application, the fee is not required to be paid again while re-applying for conversion.