A Limited Liability Partnership (LLP) is a popular business structure in India, combining the benefits of a partnership and a company. It offers limited liability protection to its partners and allows them to manage the business directly. Delhi, being a major business hub, sees a significant number of LLP registrations. This article provides a comprehensive guide on how to register an LLP in Delhi, including the steps involved, required documents, as well as the associated fees.
What is an LLP?
An LLP is a corporate business vehicle that enables professional expertise as well as entrepreneurial initiative to combine and operate in a flexible, innovative, and efficient manner. It provides the benefits of limited liability while allowing its members the flexibility of organizing their internal structure as a partnership based on a mutually arrived agreement. The LLP structure is governed by the Limited Liability Partnership Act, 2008, and it is ideal for small and medium-sized businesses.
Steps to Register an LLP in Delhi
1. Obtain Digital Signature Certificate (DSC)
The first step in the registration process is obtaining a Digital Signature Certificate (DSC) for the designated partners of the LLP. Since all document filing for LLP registration is online, DSC is mandatory.
2. Apply for Director Identification Number (DIN)
Next, the designated partners must apply for a Director Identification Number (DIN). You can do this while filing the LLP registration form, thus there is no need for a separate application.
3. Name Reservation
You must reserve the proposed name of the LLP through the LLP-RUN (Reserve Unique Name) form. The name should be unique and should also not resemble any existing company or LLP. The Ministry of Corporate Affairs (MCA) will approve the name if it meets the guidelines.
4. Incorporation of LLP
After name approval, the next step is to file the incorporation form (Form FiLLiP) along with the required documents. This form includes details such as the name of the LLP, partners’ details, and the registered office address.
5. File LLP Agreement
After the incorporation, you must file the LLP agreement with the ROC within 30 days. The agreement outlines the rights and duties of the partners and should be executed on a stamp paper of appropriate value.
Documents Required for LLP Registration
- For Partners:
- PAN Card
- Address Proof (Aadhaar Card, Voter ID, Passport)
- Residence Proof (Utility Bill, Bank Statement)
- For Registered Office:
- Proof of address (Rent Agreement, Electricity Bill, Property Deed)
- NOC from the owner
- Additional Documents:
- Subscriber Sheet
- Consent to Act as Designated Partners
- Details of LLP/Company in which partner/designated partner is a director/partner (if applicable)
LLP Registration Fees in Delhi
There are 3 main types of LLP Registration fees in Delhi:
Government Fees
The government fees for LLP registration depend on the contribution of the partners. Here is a breakdown of the fees:
- Contribution up to ₹1 lakh: ₹500
- Contribution between ₹1 lakh and ₹5 lakh: ₹2000
- Contribution between ₹5 lakh and ₹10 lakh: ₹4000
- Contribution above ₹10 lakh: ₹5000
Professional Fees
In addition to government fees, professional fees are charged by Chartered Accountants, Company Secretaries, or legal firms for assisting in the registration process. These fees can vary based on the complexity of the registration and the services offered. On average, professional fees can range from ₹5,000 to ₹15,000.
Stamp Duty
Stamp duty is payable on the LLP agreement, which varies from state to state. In Delhi, the stamp duty for the LLP agreement is calculated based on the capital contribution of the partners. The general rates are as follows:
- Contribution up to ₹1 lakh: ₹100
- Contribution above ₹1 lakh: ₹200
Advantages of Registering an LLP in Delhi
- Limited Liability: The liability of partners is limited to their agreed contribution. Personal assets are protected.
- Separate Legal Entity: An LLP is a separate legal entity from its partners, providing flexibility and reducing personal risk.
- Operational Flexibility: LLPs offer more flexibility in management and operations compared to private limited companies.
- Tax Benefits: LLPs enjoy various tax benefits and are also subject to fewer compliance requirements.
- Ease of Raising Funds: LLPs can easily raise funds from financial institutions as well as investors.
Conclusion
Thus registering an LLP in Delhi is a structured process that offers numerous advantages to business owners. By combining the features of both a partnership and a company, LLPs provide a flexible, yet secure business structure. Understanding the steps involved, the required documentation as well as the associated fees is crucial for a smooth registration process. Delhi, being a significant commercial center, offers a favorable environment for businesses to thrive. By choosing the LLP structure, entrepreneurs can ensure they are well-protected legally while enjoying the operational flexibility necessary for business growth. Whether you are a small business owner or planning to start a medium-sized enterprise, registering an LLP in Delhi could be a prudent decision to consider.