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LLP Formation in India
Complete Process, Documents & Legal Requirements
Governed by LLP Act, 2008 | Ministry of Corporate Affairs (MCA)
Introduction
About LLP
Benefits
Minimum Requirements
Documents Required
Step-by-Step Process
LLP vs Partnership
Timeline & Compliance
Common Mistakes
FAQs
LLP Formation has become one of the most preferred business structures in India for startups, professionals, and small businesses. A Limited Liability Partnership (LLP) combines flexibility with limited liability protection.
What Is a Limited Liability Partnership (LLP)?
- Separate legal entity
- Limited liability of partners
- Perpetual succession
- Governed by LLP Act, 2008
Key Benefits of LLP Formation
- Limited liability protection
- No minimum capital requirement
- Lower compliance than companies
- Ideal for professionals & SMEs
Minimum Requirements
| Requirement | Details |
|---|---|
| Minimum Partners | 2 |
| Resident Partner | At least 1 |
| Capital | No minimum |
| DSC | Mandatory |
Documents Required
- PAN & Aadhaar of partners
- Address proof & photographs
- Registered office proof
- Digital Signature Certificate
LLP Formation Process
- Obtain DSC
- Name approval (RUN-LLP)
- File FiLLiP
- Execute LLP Agreement (Form 3)
LLP vs Partnership Firm (India)
| Criteria | LLP | Partnership Firm |
|---|---|---|
| Governing Law | LLP Act, 2008 | Partnership Act, 1932 |
| Legal Status | Separate legal entity | No separate entity |
| Liability | Limited | Unlimited |
| Registration | Mandatory with MCA | Optional |
| Compliance | Moderate | Low |
| Best For | Professionals & growing businesses | Small & family businesses |
If liability protection and future scalability matter, LLP is strongly recommended.
Timeline & Post-Incorporation Compliance
- Formation time: 7–10 working days
- PAN & bank account opening
- GST registration (if applicable)
- Annual MCA filings
Common Mistakes
- Incorrect documents
- Weak LLP agreement
- Name approval issues
FAQs
- Is LLP better than partnership? Yes, due to limited liability.
- Can LLP be converted later? Yes.
- Is GST mandatory? Based on turnover.
LLP Formation in India
Complete Process, Documents & Legal Requirements
Governed by LLP Act, 2008 | Ministry of Corporate Affairs (MCA)
Introduction
About LLP
Benefits
Minimum Requirements
Documents Required
Step-by-Step Process
LLP vs Partnership
Timeline & Compliance
Common Mistakes
FAQs
LLP Formation has become one of the most preferred business structures in India for startups, professionals, and small businesses. A Limited Liability Partnership (LLP) combines flexibility with limited liability protection.
What Is a Limited Liability Partnership (LLP)?
- Separate legal entity
- Limited liability of partners
- Perpetual succession
- Governed by LLP Act, 2008
Key Benefits of LLP Formation
- Limited liability protection
- No minimum capital requirement
- Lower compliance than companies
- Ideal for professionals & SMEs
Minimum Requirements
| Requirement | Details |
|---|---|
| Minimum Partners | 2 |
| Resident Partner | At least 1 |
| Capital | No minimum |
| DSC | Mandatory |
Documents Required
- PAN & Aadhaar of partners
- Address proof & photographs
- Registered office proof
- Digital Signature Certificate
LLP Formation Process
- Obtain DSC
- Name approval (RUN-LLP)
- File FiLLiP
- Execute LLP Agreement (Form 3)
LLP vs Partnership Firm (India)
| Criteria | LLP | Partnership Firm |
|---|---|---|
| Governing Law | LLP Act, 2008 | Partnership Act, 1932 |
| Legal Status | Separate legal entity | No separate entity |
| Liability | Limited | Unlimited |
| Registration | Mandatory with MCA | Optional |
| Compliance | Moderate | Low |
| Best For | Professionals & growing businesses | Small & family businesses |
If liability protection and future scalability matter, LLP is strongly recommended.
Timeline & Post-Incorporation Compliance
- Formation time: 7–10 working days
- PAN & bank account opening
- GST registration (if applicable)
- Annual MCA filings
Common Mistakes
- Incorrect documents
- Weak LLP agreement
- Name approval issues
FAQs
- Is LLP better than partnership? Yes, due to limited liability.
- Can LLP be converted later? Yes.
- Is GST mandatory? Based on turnover.
Business Compliance & Filing Due Dates – India
Statutory Compliance Comparison with Last Dates (Indian Law)
Proprietorship
OPC
LLP
Private Limited
Section 8 Company
Proprietorship – Compliance & Due Dates
| Compliance | Applicability | Due Date |
|---|---|---|
| Appointment of Auditor (ADT-1) | Not Applicable | — |
| Issue of Share Certificates | Not Applicable | — |
| Business Bank Account | Required | At start of business |
| GST Registration | If applicable | Before crossing threshold |
| ROC Filings | Not Applicable | — |
| Income Tax Return (ITR-3 / ITR-4) | Mandatory | 31 July / 31 Oct |
Proprietorship is governed by Income-tax Act, not Companies Act.
One Person Company (OPC)
| Compliance | Applicability | Due Date |
|---|---|---|
| First Auditor (ADT-1) | Mandatory | Within 15 days of incorporation |
| Share Certificates | Mandatory | Within 60 days |
| Company Bank Account | Mandatory | Immediately after incorporation |
| GST Registration | If applicable | Before taxable supply |
| ROC Filing – AOC-4 | Mandatory | Within 180 days |
| ROC Filing – MGT-7A | Mandatory | Within 60 days |
| Income Tax Return (ITR-6) | Mandatory | 31 Oct |
Limited Liability Partnership (LLP)
| Compliance | Applicability | Due Date |
|---|---|---|
| Auditor Appointment | If applicable | Within 30 days |
| Share Certificates | Not Applicable | — |
| LLP Bank Account | Mandatory | Immediately after registration |
| GST Registration | If applicable | Before supply |
| Form 11 (Annual Return) | Mandatory | 30 May |
| Form 8 (Statement of Accounts) | Mandatory | 30 Oct |
| Income Tax Return (ITR-5) | Mandatory | 31 Oct |
Private Limited Company
| Compliance | Applicability | Due Date |
|---|---|---|
| First Auditor (ADT-1) | Mandatory | Within 15 days |
| Share Certificates | Mandatory | Within 60 days |
| Company Bank Account | Mandatory | Immediately after incorporation |
| GST Registration | If applicable | Before supply |
| AOC-4 (Financials) | Mandatory | Within 30 days of AGM |
| MGT-7 (Annual Return) | Mandatory | Within 60 days of AGM |
| Income Tax Return (ITR-6) | Mandatory | 31 Oct |
Section 8 Company (Non-Profit)
| Compliance | Applicability | Due Date |
|---|---|---|
| First Auditor (ADT-1) | Mandatory | Within 15 days |
| Share Certificates | Not Applicable | — |
| Company Bank Account | Mandatory | Immediately after incorporation |
| GST Registration | If applicable | Before taxable activity |
| AOC-4 | Mandatory | Within 30 days of AGM |
| MGT-7 | Mandatory | Within 60 days of AGM |
| Income Tax Return | Mandatory | 31 Oct (Even if Nil) |
Non-compliance may lead to cancellation of Section 8 license.
Business Compliance & Filing Due Dates – India
Statutory Compliance Comparison with Last Dates (Indian Law)
Proprietorship
OPC
LLP
Private Limited
Section 8 Company
Proprietorship – Compliance & Due Dates
| Compliance | Applicability | Due Date |
|---|---|---|
| Appointment of Auditor (ADT-1) | Not Applicable | — |
| Issue of Share Certificates | Not Applicable | — |
| Business Bank Account | Required | At start of business |
| GST Registration | If applicable | Before crossing threshold |
| ROC Filings | Not Applicable | — |
| Income Tax Return (ITR-3 / ITR-4) | Mandatory | 31 July / 31 Oct |
Proprietorship is governed by Income-tax Act, not Companies Act.
One Person Company (OPC)
| Compliance | Applicability | Due Date |
|---|---|---|
| First Auditor (ADT-1) | Mandatory | Within 15 days of incorporation |
| Share Certificates | Mandatory | Within 60 days |
| Company Bank Account | Mandatory | Immediately after incorporation |
| GST Registration | If applicable | Before taxable supply |
| ROC Filing – AOC-4 | Mandatory | Within 180 days |
| ROC Filing – MGT-7A | Mandatory | Within 60 days |
| Income Tax Return (ITR-6) | Mandatory | 31 Oct |
Limited Liability Partnership (LLP)
| Compliance | Applicability | Due Date |
|---|---|---|
| Auditor Appointment | If applicable | Within 30 days |
| Share Certificates | Not Applicable | — |
| LLP Bank Account | Mandatory | Immediately after registration |
| GST Registration | If applicable | Before supply |
| Form 11 (Annual Return) | Mandatory | 30 May |
| Form 8 (Statement of Accounts) | Mandatory | 30 Oct |
| Income Tax Return (ITR-5) | Mandatory | 31 Oct |
Private Limited Company
| Compliance | Applicability | Due Date |
|---|---|---|
| First Auditor (ADT-1) | Mandatory | Within 15 days |
| Share Certificates | Mandatory | Within 60 days |
| Company Bank Account | Mandatory | Immediately after incorporation |
| GST Registration | If applicable | Before supply |
| AOC-4 (Financials) | Mandatory | Within 30 days of AGM |
| MGT-7 (Annual Return) | Mandatory | Within 60 days of AGM |
| Income Tax Return (ITR-6) | Mandatory | 31 Oct |
Section 8 Company (Non-Profit)
| Compliance | Applicability | Due Date |
|---|---|---|
| First Auditor (ADT-1) | Mandatory | Within 15 days |
| Share Certificates | Not Applicable | — |
| Company Bank Account | Mandatory | Immediately after incorporation |
| GST Registration | If applicable | Before taxable activity |
| AOC-4 | Mandatory | Within 30 days of AGM |
| MGT-7 | Mandatory | Within 60 days of AGM |
| Income Tax Return | Mandatory | 31 Oct (Even if Nil) |
Non-compliance may lead to cancellation of Section 8 license.
Business Structure Comparison in India
LLP Formation vs OPC vs Private Limited vs Section 8 vs Proprietorship
Choose the right legal structure for your business based on ownership, liability, compliance, and growth plans.
| Criteria | Proprietorship | OPC | LLP | Private Limited | Section 8 Company |
|---|---|---|---|---|---|
| Legal Status | Not a separate legal entity | Separate legal entity | Separate legal entity | Separate legal entity | Separate legal entity |
| Number of Owners | 1 | 1 (with nominee) | Minimum 2 partners | Minimum 2 shareholders | Minimum 2 members |
| Liability | Unlimited | Limited | Limited | Limited | Limited |
| Minimum Capital | No requirement | No requirement | No requirement | No requirement | No requirement |
| Compliance Level | Very Low | Moderate | Low | High | High |
| Annual Audit | Not mandatory (below limits) | Mandatory | Conditional | Mandatory | Mandatory |
| Fund Raising | Not possible | Limited | Difficult | Easy (VC, Investors) | Donations / Grants only |
| Profit Distribution | Owner only | Owner only | Partners as per agreement | Dividend to shareholders | Not allowed |
| Taxation | As individual slab | Corporate tax | 30% + cess | Corporate tax | Exempt (with 12A/80G) |
| Ideal For | Small traders, freelancers | Solo entrepreneurs | Professionals, SMEs | Startups, scalable businesses | NGOs, charitable organizations |
Quick Guidance:
• Choose Proprietorship for very small or local businesses
• Choose OPC if you are a solo founder wanting limited liability
• Choose LLP for professional or partnership businesses
• Choose Private Limited for startups & growth-oriented companies
• Choose Section 8 for non-profit or charitable activities
• Choose Proprietorship for very small or local businesses
• Choose OPC if you are a solo founder wanting limited liability
• Choose LLP for professional or partnership businesses
• Choose Private Limited for startups & growth-oriented companies
• Choose Section 8 for non-profit or charitable activities
Business Structure Comparison in India
LLP Formation vs OPC vs Private Limited vs Section 8 vs Proprietorship
Choose the right legal structure for your business based on ownership, liability, compliance, and growth plans.
| Criteria | Proprietorship | OPC | LLP | Private Limited | Section 8 Company |
|---|---|---|---|---|---|
| Legal Status | Not a separate legal entity | Separate legal entity | Separate legal entity | Separate legal entity | Separate legal entity |
| Number of Owners | 1 | 1 (with nominee) | Minimum 2 partners | Minimum 2 shareholders | Minimum 2 members |
| Liability | Unlimited | Limited | Limited | Limited | Limited |
| Minimum Capital | No requirement | No requirement | No requirement | No requirement | No requirement |
| Compliance Level | Very Low | Moderate | Low | High | High |
| Annual Audit | Not mandatory (below limits) | Mandatory | Conditional | Mandatory | Mandatory |
| Fund Raising | Not possible | Limited | Difficult | Easy (VC, Investors) | Donations / Grants only |
| Profit Distribution | Owner only | Owner only | Partners as per agreement | Dividend to shareholders | Not allowed |
| Taxation | As individual slab | Corporate tax | 30% + cess | Corporate tax | Exempt (with 12A/80G) |
| Ideal For | Small traders, freelancers | Solo entrepreneurs | Professionals, SMEs | Startups, scalable businesses | NGOs, charitable organizations |
Quick Guidance:
• Choose Proprietorship for very small or local businesses
• Choose OPC if you are a solo founder wanting limited liability
• Choose LLP for professional or partnership businesses
• Choose Private Limited for startups & growth-oriented companies
• Choose Section 8 for non-profit or charitable activities
• Choose Proprietorship for very small or local businesses
• Choose OPC if you are a solo founder wanting limited liability
• Choose LLP for professional or partnership businesses
• Choose Private Limited for startups & growth-oriented companies
• Choose Section 8 for non-profit or charitable activities
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