LLP Registration Cost

A Limited Liability Partnership (LLP) is a popular business structure that blends the features of a traditional partnership with the limited liability protection of a private company. It offers flexibility and legal protection, making it ideal for startups and small businesses. For new entrepreneurs, knowing the registration cost is important for financial planning. The total cost depends on several factors like government fees, professional service charges, digital signature requirements, and stamp duty, which can vary from state to state. In this blog, you will learn the details about the LLP registration cost in brief.

What is an LLP Registration?

LLP registration is the legal procedure to form a Limited Liability Partnership in India, governed by the LLP Act, 2008. It allows two or more individuals to start a business together with shared control and responsibilities. One key benefit is that partners are not personally liable for business debts. This structure offers the flexibility of a partnership with the added protection of limited liability. This makes it suitable for startups and small businesses.

In an LLP, each partner is only responsible for the amount they contribute to the business. They are not held accountable for another partner’s mistakes or misconduct. The entire registration process is carried out online through the Ministry of Corporate Affairs (MCA).

Details About the LLP Registration Cost in Brief

Here is a breakdown of the LLP registration Cost as per the Ministry of Corporate Affairs (MCA) fee structure:

1. Government Filing Fees:

• For contribution up to Rs. 1 lakh: Rs. 500
• Rs. 1 lakh to Rs. 5 lakh: Rs. 2,000
• Rs. 5 lakh to Rs. 10 lakh: Rs. 4,000
• Above Rs. 10 lakh: Rs. 5,000

2. Filing of LLP Agreement (Form 3): Charges range between Rs. 50 to Rs. 200 depending on the capital contribution.
3. RUN-LLP (Name Reservation Fee): A flat fee of Rs. 200 is charged to reserve a unique LLP name.
4. Digital Signature Certificate (DSC): Each designated partner must obtain a DSC, costing around Rs. 1,000 to Rs. 1,500.
5. Director Identification Number (DIN/DPIN): When you apply for LLP registration using the FiLLiP form or company incorporation through the SPICe+ form, you do not need to pay separately for DIN or DPIN. These identification numbers are issued free of cost during the registration process.
6. Stamp Duty: Stamp duty for LLP registration depends on the state where the business is set up and the total capital contribution. The price of stamp duty varies, depending on local government norms.
7. Professional Fees (Optional): CAs, CSs, or legal firms offer complete LLP registration support, including documentation, compliance, and filing assistance for a smooth and error-free process.

Documents Required for LLP Registration in India

Below is the list of documents required for LLP Registration in India:

1. Documents of Partners & Designated Partners

• PAN card: Mandatory identity proof for all Indian partners
• Address proof: Aadhaar, voter ID, passport, driver’s license, or recent utility bill (≤?2 months)
• Passport-size photograph: Recent, preferably white background
• Passport + notarised/apostilled English translation: Required for foreign nationals or NRIs

2. Registered Office Address Proof

• Owned property: Utility bill (e.g., electricity), ownership proof (sale deed/property tax receipt), etc
• Rented office: Rent agreement, NOC from landlord, recent utility bill, etc

3. Digital Signature Certificate (DSC) & DPIN/DIN

• Class 3 DSC: All designated partners must have one for online filings
• DPIN/DIN: Unique ID for designated partners, applied through FiLLiP

4. Other Supporting Documents

• Consent letters: Each designated partner’s declaration of consent
• Subscriber sheet: Signed by partners and witnessed by a CA/CS/advocate.
• Draft LLP agreement: To be filed within 30 days of incorporation.

Steps of LLP Registration in India

Here is a step-by-step LLP registration process in India:

Step 1: Obtain a Digital Signature Certificate (DSC)

Each designated partner must get a valid Digital Signature Certificate. This certificate helps submit documents on the Ministry of Corporate Affairs (MCA) portal. The partner provides proof of identity, proof of address, and a passport-size photo to the certifying authority. Without a DSC, the partner cannot complete the online registration process.

Step 2: Apply for Director Identification Number (DIN)

Every designated partner must hold a Director Identification Number. The applicant can apply through Form DIR-3 on the MCA portal. The DIN helps identify the partner in government records. It remains valid for life and links the partner to one or more LLPs.

Step 3: Name Reservation

The applicant must select a unique name for the LLP. They enter the proposed name in Form FiLLiP on the MCA portal. The name must follow the official naming rules. If the name is available and valid, the MCA reserves it for incorporation.

Step 4: Incorporation of LLP

Once the name is approved, the applicant fills out Form FiLLiP on the MCA portal. This form collects details such as the name of the LLP, registered office address, capital contribution, and partner information. Once the verification process is complete, the Ministry of Corporate Affairs (MCA) grants a Certificate of Incorporation. This document confirms the legal status of the LLP.

Step 5: Draft and File LLP Agreement

The LLP partners prepare an agreement that mentions the duties, capital share, and profit ratio of each partner. All partners sign the agreement and submit it through Form 3 on the MCA portal. This must happen within 30 days after receiving the incorporation certificate.

Step 6: Apply for PAN and TAN

After incorporation, the LLP applies for a Permanent Account Number (PAN) and a Tax Deduction Account Number (TAN). These are issued through forms available on the Income Tax Department portal. PAN helps with income tax compliance. TAN is necessary if the LLP needs to deduct tax at source.

Step 7: Open a Bank Account

The LLP opens a current account with a nationalised or private bank. The LLP submits the Certificate of Incorporation, PAN, LLP Agreement, and proof of registered office address. The bank verifies the documents and activates the account. This account allows the LLP to receive payments and manage its financial operations.

Benefits of LLP Registration in India

Here are the key benefits of LLP registration in India:

1. Limited Liability Protection

Each partner in an LLP is liable only to the extent of their contribution. Personal property remains safe even if the business faces legal or financial issues. This protects individuals from the risk of business loss.

2. Separate Legal Identity

An LLP holds a distinct identity under the law. It can own property, sign contracts, and file lawsuits in its name. This helps the LLP gain trust from banks, vendors, and clients.

3. No Minimum Capital Requirement

There is no fixed amount of capital needed to start an LLP. You can begin with any amount. This allows small businesses and professionals to start without large investments.

4. Flexibility in Management

The LLP structure allows partners to decide how they want to share profits and responsibilities. The terms are written in the LLP agreement, which gives full control to the partners to run the business as they decide.

5. Lower Compliance Requirements

LLPs follow simpler rules compared to companies. An audit is not necessary unless the turnover crosses Rs 40 lakh or the capital goes beyond Rs 25 lakh. This helps save both time and cost.

6. Tax Advantages

LLPs do not pay dividend distribution tax. The profit goes directly to the partners, which avoids double taxation. This makes the LLP structure more tax-efficient than companies.

7. Continuous Existence

An LLP does not end if a partner leaves, dies, or retires. The business continues under the same name and structure. This provides long-term stability and protects the firm’s identity.

8. Suitable for Professionals

An LLP suits professionals like consultants, architects, lawyers, and chartered accountants. It offers them a legal structure with limited liability while allowing flexible operations.

9. Cost-Effective Setup

The government fees for LLP registration are low. Ongoing compliance costs are also minimal. This makes it easier for startups and service-based firms to manage their finances and grow.

Conclusion

LLP registration cost involves various components such as filing fees, DSC charges, professional services, and stamp duty. Understanding each cost in advance helps avoid surprises and ensures smoother budgeting. A transparent fee structure builds trust and supports informed decision-making. Entrepreneurs should also prepare for ongoing expenses to maintain compliance and ensure the long-term success of their LLP. If you want to do an LLP registration with no hassle, contact Online Legal India to get assistance.