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What is Limited Liability Partnership?

If you’re an entrepreneur looking for a flexible yet secure business structure, a Limited Liability Partnership (LLP) could be the perfect choice for you. LLPs combine the best features of a partnership and a private company, offering both flexibility and limited liability protection.

Introduced in India in 2008 under the Limited Liability Partnership Act, an LLP allows you to run your business with the advantage of personal asset protection. 

This means you, as a partner, won’t be personally liable for the business’s debts or liabilities. Plus, LLPs don’t require any minimum capital, making them an affordable option for new entrepreneurs and small businesses. The structure of an LLP ensures your business continues to operate even if a partner leaves or passes away, similar to a corporation.

Furthermore, you are protected from joint liability caused by the wrongful actions of other partners. This makes LLPs a popular choice among professionals, family-owned businesses, and micro and small enterprises.

Whether you’re starting small or looking for a more structured approach to your business, an LLP offers the best of both worlds—limited liability and operational flexibility.

If you’re ready to take the next step in your entrepreneurial journey.

Limited Liability Partnership

At eTaxCart, our mission is to make tax and compliance stress-free — so you can focus on growing your career, your business, or your next big idea.

Advantages

Separate Legal Entity

An LLP is a distinct legal entity, which means it can own property, enter into contracts, and continue to exist even if a partner exits or passes away.

Limited Liability Protection

Partners' personal assets are protected from business liabilities, as they are only liable to the extent of their investment in the LLP.

No Minimum Capital Requirement​

Unlike companies, LLPs don’t require a minimum capital contribution, making it easier for small entrepreneurs to start a business.

Simplified Compliance

LLPs have fewer compliance requirements than private companies, making them easier to manage, especially for small and medium-sized businesses.

Attracts Investment

LLPs are a more attractive structure for investors compared to traditional partnerships due to the limited liability and formal structure.

No Restriction on Number of Partners

LLPs can have any number of partners, unlike certain business structures that have a limit on the number of partners or shareholders.

Protection from Partner Misconduct

Partners are not liable for each other’s wrongful actions, protecting them from joint liability created by another partner’s mistake or misconduct.

Flexibility in Management

LLPs offer flexible management and operational structures, allowing partners to define roles and responsibilities through an LLP agreement.

Disadvantages

Limited to Two Partners (for registration in India)

LLPs in India require a minimum of two partners to form, which may not be suitable for individuals wanting to run a business alone.

Restrictions on Foreign Ownership

Although foreign nationals or entities can be partners in an LLP in India, they must comply with regulations set by the Foreign Direct Investment (FDI) policy, which can limit flexibility for foreign investors.

Lack of Equity Financing

LLPs are generally not able to issue shares to raise capital, limiting their ability to attract investment from a wider pool of investors, especially venture capital or equity investors.

Not Suitable for Large Companies

LLPs are best suited for small and medium-sized businesses. Larger businesses with many shareholders and extensive operations may prefer the more structured format of a private limited company.

Limited Recognition

In some jurisdictions, an LLP may not have the same level of recognition or credibility as a company, which could affect business opportunities, especially with international clients or partners.

No Public Trading

Since an LLP cannot issue shares, it cannot raise funds through public trading, unlike corporations. This might restrict growth opportunities for some businesses.

Limited Ability to Offer Employee Stock Options (ESOPs)

Unlike private limited companies, LLPs cannot offer stock options to employees as a means to attract or retain talent. This could affect recruitment and retention strategies for startups aiming to build a strong team.

Key Features of Limited Liability Partnership

Here are the key features of a Limited Liability Partnership in India

  • Flexible Management Structure

    LLPs provide flexibility in the management of the business. Partners can decide how to manage the business, and there’s no mandatory requirement for board meetings or shareholder resolutions like in a company.

  • Limited Liability Protection

    Partners' liability is limited to their agreed contribution in the LLP. Personal assets are protected from the debts or liabilities of the business, unlike in traditional partnerships.

  • No Minimum Capital Requirement

    There is no minimum capital requirement for setting up an LLP, making it an affordable and accessible option for entrepreneurs and small businesses.

  • No Restriction on the Number of Partners

    An LLP can have any number of partners, and the number can change over time, offering flexibility in the business structure.

  • Perpetual Succession

    An LLP continues to exist even if a partner dies, retires, or is insolvent. The partnership is not dissolved due to changes in membership, similar to a corporation.

  • Limited Liability for Partners

    Partners are not personally responsible for the wrongful actions of other partners. Their liability is limited to the extent of their capital contribution to the LLP.

  • Easy to Set Up and Maintain

    Compared to a private limited company, an LLP has simpler compliance requirements and is easier to manage. There’s no need for annual general meetings or board meetings unless stipulated in the LLP agreement.

  • Partnership Agreement

    An LLP is governed by an LLP agreement, which defines the rights, duties, and obligations of each partner, and outlines profit-sharing, decision-making processes, and dispute resolution mechanisms.

  • No Requirement for Audits (for Small LLPs)

    In some cases, LLPs with a certain turnover threshold may not need to undergo mandatory audits, which reduces administrative costs.

  • Flexibility in Profit Sharing

    Profit-sharing in an LLP is not based on capital contributions alone but can be agreed upon by the partners as per the LLP agreement, offering flexibility in how profits are distributed.

Required Documents for Limited Liability Partnership Registration

To ensure a seamless and efficient registration process for a Limited Limited Partnership, the following documents are essential. These documents are organized based on the requirements for partners and the registered address of the LLP.

Documents for Partners

View the documents required for the directors.

PAN Card: All partners must provide their PAN card as identity proof.
Address Proof: Submit one of the following: Passport, Aadhaar, Voter ID, or Driving License. Ensure details match the PAN card.
Residence Proof: Provide a recent utility bill (telephone, electricity, bank statement, etc.), not older than 2 months, showing the partner’s name.
Passport-sized Photos: Provide recent passport-sized photos of all partners.
Passport (for NRIs/Foreign Nationals): NRIs and foreign nationals must submit a notarized passport from the relevant authorities or the Indian Embassy.

For the Registered Office Address

Proof of For the Registered Office Address

If the office is rented, provide a No Objection Certificate (NOC) and Rent Agreement from the landlord. eTaxcart will help you out with format of NOC.

Submit recent utility bills (electricity, gas, telephone) that show the full address and owner’s name, not older than 2 months.

Stages of Limited Liability Partnership

Application

Submit the application for name reservation of the proposed LLP.

Digital Signature

Obtain the Digital Signature Certificate (DSC).

Draft Finalization

Draft and finalize the Partnership deed, and other necessary documents.

Complete

Complete the incorporation process to receive the incorporation certificate, PAN, and TAN.

Our Pricing Plans

Choose the plan that best fits for you. We have three major plans to offer.

Starter

₹1499+ Govt Fees
  • Name Application(within 2 Days)
  • Digital Signature Certificates for two (within 3 Days)
  • Designated Partner Identification Number for two directors
  • FiLLip form filing in 12 days
  • LLP incorporation certificate in 25-35 Days
  • LLP Agreement
  • PAN
  • TAN
Choose Plan

Growth

₹2999+ Govt Fees
  • All features outlined in the Starter package.
  • One time filing GST registration application
  • MSME Registration
  • Name Application (within 1 Day)
  • Digital Signature Certificates for two (within 2 Days)
  • FiLLip form filing in 7 days
  • LLP incorporation certificate in 15-18 Days
Choose Plan

Elite

₹15599+ Govt Fees
  • All features outlined in the Growth package.
  • One trademark filing in the name of an individual, sole proprietor.
  • Four quarterly TDS returns, if applicable (upto 100 entry)
  • LLP Form One annual filing (for turnover up to 30 lakhs)
  • LLP Form 8 (Statement of account and solvency)
  • DIR-3 e-KYC for two partners
  • Accounting and bookkeeping services (up to 75 transactions)
Choose Plan

PAN and courier charges: 250

State of Registration2 DSCRUN + PAN/TANLLP Incorporation Govt. FeesLLP Agreement Stamp and notary for Capital 10,000Estimated Total fees other than eTaxcart
Maharashtra₹4,600₹456₹643₹ 1,000.00₹ 6,699
Delhi₹4,600₹456₹643₹ 1,000.00₹ 6,699
West Bengal₹4,600₹456₹643₹ 150.00₹ 5,849
Uttar Pradesh₹4,600₹456₹643₹ 750.00₹ 6,449
Karnataka₹4,600₹456₹643₹ 5,000.00₹ 10,699
Tamilnadu₹4,600₹456₹643₹ 300.00₹ 5,999
Gujarat₹4,600₹456₹643₹ 1,000.00₹ 6,699
Haryana₹4,600₹456₹643₹ 1,000.00₹ 6,699
Rajasthan₹4,600₹456₹643₹ 4,000.00₹ 9,699
Kerala₹4,600₹456₹643₹ 5,000.00₹ 10,699
Bihar₹4,600₹456₹643₹ 2,500.00₹ 8,199
Madhya Pradesh₹4,600₹456₹643₹ 2,000.00₹ 7,699
Andhra Pradesh₹4,600₹456₹643₹ 500.00₹ 6,199
Punjab₹4,600₹456₹643₹ 1,000.00₹ 6,699
Jharkhand₹4,600₹456₹643₹ 2,500.00₹ 8,199
Assam₹4,600₹456₹643₹ 100.00₹ 5,799
Uttarakhand₹4,600₹456₹643₹ 750.00₹ 6,449
Goa₹4,600₹456₹643₹ 150.00₹ 5,849
Himachal Pradesh₹4,600₹456₹643₹ 100.00₹ 5,799
Manipur₹4,600₹456₹643₹ 100.00₹ 5,799
Tripura₹4,600₹456₹643₹ 100.00₹ 5,799
Meghalaya₹4,600₹456₹643₹ 100.00₹ 5,799
Arunachal Pradesh₹4,600₹456₹643₹ 100.00₹ 5,799
Nagaland₹4,600₹456₹643₹ 100.00₹ 5,799
Daman and Diu₹4,600₹456₹643₹ 150.00₹ 5,849
Dadar nagar Haveli₹4,600₹456₹643₹ 1,000.00₹ 6,699
Mizoram₹4,600₹456₹643₹ 100.00₹ 5,799
  • 1,999 extra per DSC, courier charges extra
  • Application filing FiLLip time depends on MCA portal availability and best efforts will be taken by etaxCart to complete in stated time
  • Above government fees, stamp and notary charges might change depending on state to state from time to time by respective Govts/vendors.
  • Government fees for trademark extra in elite package
  • Audit is not included
  • The customer is responsible for purchasing stamp paper from their respective state and printing the finalized version of the LLP agreement provided by the eTaxCart team. The agreement must also be notarized. The cost for this process will be borne by the customer.

Why Choose eTaxCart for Limited Liability Partnership Registration?

At eTaxCart, our mission is to make tax and compliance stress-free — so you can focus on growing your career, your business, or your next big idea.

Simple and Quick Process

We make the registration process easy and hassle-free.

Affordable Fees

Our registration services are cost-effective, ensuring value for money.

Expert Guidance

Our professionals guide you through each step, making the entire process seamless.

Frequently Asked Questions

Here are the answers of the questions we received frequently.

What is the difference between an LLP and a partnership firm?

In a regular partnership firm, all partners are personally liable for the business’s debts, which can put personal assets at risk. However, in an LLP, the partners’ liability is limited to their agreed contribution, offering protection for their personal assets. An LLP offers better legal protection and credibility for the business.

Who can form an LLP?

Any two or more individuals or entities that are residents of India can form an LLP. The partners must be Indian citizens, and they can be individuals or companies. An LLP is particularly suitable for professionals, small businesses, or people wanting to create a business with a few partners.

What is the role of a Designated Partner in an LLP?

The Designated Partner is the person responsible for managing the day-to-day operations of the LLP and ensuring it complies with all legal requirements. Designated Partners are also the official representatives of the LLP for matters related to government authorities. This role is critical for the smooth operation and legal standing of the LLP.

What is the LLP Agreement?

The LLP Agreement is a legal document that outlines the terms and conditions governing the relationship between the partners. It specifies the rights, duties, responsibilities, profit-sharing ratio, and the decision-making process. The agreement is crucial for preventing disputes among partners and ensuring smooth business operations.

Can an LLP raise funds from investors?

Unlike a private limited company, an LLP cannot raise funds by issuing shares to the public. However, it can raise funds by accepting contributions from its partners or through loans from financial institutions. The LLP agreement governs how additional capital is contributed and managed.

Can an LLP have foreign partners?

Yes, an LLP can have foreign partners. The foreign partners must adhere to Indian laws, including foreign investment policies, and their participation is subject to government approval. This allows businesses to collaborate internationally while maintaining limited liability.

Can an LLP be converted into a private limited company?

Yes, an LLP can be converted into a private limited company once it meets the necessary criteria, such as having more than two partners or reaching a certain revenue threshold. This conversion can provide access to more funding options and the ability to issue shares, expanding the business potential.

What happens if a partner dies or is incapacitated?

In case a partner dies or becomes incapacitated, the LLP agreement specifies how their share is transferred or managed. The remaining partners can either continue the business or dissolve the LLP, depending on what is agreed upon in the agreement.

Why should I choose eTaxcart for registering my LLP?

eTaxCart makes the LLP registration process quick and easy by handling all the paperwork, legal formalities, and filings on your behalf. Our team of experts ensures that your registration is done correctly, efficiently, and without any hassles, allowing you to focus on your business.

How can eTaxcart assist with post-registration services for my LLP?

eTaxCart offers continued support even after your LLP is registered. We help you with compliance, tax filings, annual returns, and other legal requirements, ensuring your business runs smoothly and stays compliant with the law, giving you more time to grow your business.

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