Limited Liability Partnership (LLP) is a type of partnership where partners have limited liability, similar to shareholders in a company. It’s a popular choice for small businesses and professionals due to its flexibility and ease of formation.

Key Features:

• Limited Liability: Partners’ personal assets are protected from the LLP’s debts.
• Separate Legal Entity: LLP is a distinct entity from its partners.
• No Minimum Capital: There’s no set minimum capital requirement.
• Flexible Structure: LLPs offer more flexibility in terms of management and operations compared to traditional partnerships.

Benefits:

• Limited Liability: Protects partners’ personal assets.
• Ease of Formation: Simple registration process with minimal paperwork.
• Tax Benefits: LLPs enjoy favorable tax treatment.
• Flexibility: Allows for different profit-sharing arrangements and management structures.

Requirements:

• Minimum Two Partners: At least two individuals must be designated partners.
• Resident Director: At least one partner must be a resident of India.
• Name Approval: A unique name for the LLP must be approved.

Process:

1. Document Collection: Gather necessary documents like PAN cards, photographs, address proofs, and rent agreement.
2. Digital Signature: Obtain digital signatures for designated partners.
3. Name Approval: Submit an application for name approval.
4. Form Filing: File the LLP incorporation form (FiLLiP) and LLP agreement.
5. Pan and Tan: Apply for PAN and TAN numbers.

Mandatory Compliance:

• Annual Return: File an annual return within 30 days of the closing date.
• Statement of Account and Solvency: Submit a statement within 30 days of the closing date.
• Income Tax Return: File income tax returns as per the applicable laws.