LLP Registration in Mumbai | Limited Liability Partnership

LLP Company Registration in Mumbai 

A limited liability partnership or LLP registration in Mumbai is a formal partnership between at least two business partners. Each business partner has limited liability, which means that they are not entirely responsible for the company's debts or responsibilities. Partners in an LLP are not responsible for the negligent acts or malpractice of any single partner, each partner is responsible for their own negligence. Examples of LLPs include law firms, accounting firms and doctor offices because multiple partners are involved in the business. The guidelines for starting an LLP will vary by state and the amount of limitation varies by state as well.


Features of LLP Registration in Mumbai 


1.       Separate Legal Entity – The LLP has Separate Legal Entity that is the LLP and the partners are distinct from each other.


2.       Partners Required - Minimum 2 partners are required to form a LLP. However, there is no limit on the maximum number of partners.


3.       Capital Contribution – There is no requirement of Minimum Capital Contribution.


4.       No Restriction -   The LLP Act does not restrict the benefit of LLP structure to certain classes of Professionals only and would be available for use by any enterprise.


Benefits of forming LLP Registration in Mumbai


1.       Member Personal Asset Protection- If an LLP were to be sued, the personal assets of each partner would be protected.


2.       Flexible Management - Partners in an LLP determine management structure themselves, with each partner choosing how much management responsibility they would like to have.


3.       Legal Entity -    Once formed, an LLP is considered a legal entity separate from its members that can enter into contracts, or own or lease property.


4.       Less Restrictions and Compliance - Very less restrictions are enforced on a LLP by the Government as compared to the   restrictions enforced on a company.


Disadvantages of Forming an LLP


The only disadvantage of forming a LLP is that it cannot come out with its IPO and raise money from the Public which a company form of organization can easily do.


Taxation of LLPs in Mumbai


In India, the Government has notified that LLPs would be taxed in the same form as Partnerships that is Tax would be levied on the LLP and the partners would be exempt from Tax and no tax would be levied on the conversion of Partnership Firms into Limited Liability Partnership. The Income Tax Return shall be signed and verified by the designated partner and where for any unavoidable reason the designated partner is not able to sign the return of income or where there is no designated partner, by any other partner.


It is best to say that a limited liability partnership not only renders protection to the partners but also retains all the benefits of partnership. Although the traditional partnership has an advantage, it is not mandatory for a partnership to register before any statutory authorization, while a limited liability company must be registered under the 2008 Law on limited liability, the process that can be tedious. Still, in my opinion the balance is titled in the favor of the latte. In addition, although the partnership form has been in use for a long time and the law applicable to partnership was codified in statutes over a hundred years ago, the characteristics of the partnership law can present serious drawbacks today. In the eyes of the law, partnership is only one way of describing the individual partner that makes up the partnership. Today, the world is facing an unprecedented financial crisis, which is negatively affecting the economies of most countries, including ours. In such a situation, the availability of LLP as an alternative commercial vehicle to our trade and industry will be an important step. India's service industry has grown considerably and accounts for almost half of our GDP.


We believe that LLPs would further contribute to the growth of service industries in the future. So, if you need any legal or professional assistance LLP company registration in Mumbai, contact Legalo now. 

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