What an LLP is
An LLP is a separate legal entity from its partners, with perpetual succession and the ability to own property and enter contracts in its own name — much like a company. Where it differs is in internal governance: an LLP is run according to an LLP agreement the partners themselves draft, rather than a prescribed board structure, and it doesn't have shares or shareholders in the company sense. Every partner's liability is limited to their agreed contribution, except in cases of fraud.
The compliance burden sits meaningfully below a private limited company's — no mandatory annual audit unless turnover or contribution crosses a prescribed threshold, no board meeting requirements, and simpler annual filings. This is the main reason professional firms and bootstrapped service businesses often choose an LLP over a company.
Who an LLP suits
It generally suits:
- professional practices and consultancies — CAs, architects, designers, agencies — with two or more partners;
- service businesses that want limited liability without the audit and board-meeting overhead of a company;
- businesses with no near-term plan to raise institutional equity funding.
It's usually the wrong choice where:
- the business plans to raise equity from investors, since LLPs can't issue shares in the way a company can;
- an employee stock option scheme is planned, which needs a company structure;
- there's only one founder — a one person company or proprietorship fits a solo founder better.
Documents required
For each partner
- PAN card.
- Identity proof — Aadhaar, passport, voter ID or driving licence.
- Address proof — bank statement or utility bill, not older than two months.
- Passport-size photograph, email address and mobile number.
For the registered office
- Utility bill for the premises, not older than two months.
- Rent agreement and owner's no-objection certificate, where the premises are rented.
Prepared as part of the filing
- Digital signature certificates for the designated partners.
- The proposed LLP name, checked against existing companies, LLPs and trademarks.
- The LLP agreement, setting out capital contribution, profit-sharing ratio, and partners' roles and responsibilities.
The LLP registration process, step by step
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Digital signature certificates
Designated partners obtain digital signatures, needed to sign the incorporation forms electronically.
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Name reservation
The proposed name is checked and reserved through the FiLLiP form itself, which combines name reservation with the incorporation application.
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Filing FiLLiP
The incorporation application is filed with details of the partners, registered office, and proposed business activity, along with DPIN applications for partners who don't already hold one.
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Certificate of Incorporation
On approval, the Registrar issues the Certificate of Incorporation, confirming the LLP's Identification Number.
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Filing the LLP Agreement
The LLP agreement, executed by all partners and stamped, is filed separately in Form 3 within 30 days of incorporation — this is a distinct step from incorporation itself, and is often the one that gets delayed.
Ongoing compliance after incorporation
- Form 11 (Annual Return) — due 30 May every year, regardless of activity.
- Form 8 (Statement of Account and Solvency) — due 30 October every year.
- Statutory audit — required only once turnover or contribution crosses the prescribed threshold.
- Income tax return — filed annually, with the LLP taxed at a flat rate rather than on individual slabs.
See our LLP annual filing page for the full detail on Form 8 and Form 11.
Practical notes from our engagements
- The LLP Agreement filing forgotten after incorporation. Getting the Certificate of Incorporation feels like the finish line, but Form 3 (the LLP agreement) is a separate filing with its own 30-day deadline — missing it is one of the most common early defaults.
- Profit-sharing and capital contribution left vague in the agreement. A poorly drafted LLP agreement causes disputes later — this document is worth the same care as a shareholders' agreement would get in a company.
- Assuming no audit means no accounting obligation. Even below the audit threshold, the LLP still needs properly maintained books to support Form 8 and its income tax return.
- A designated partner's residency requirement overlooked. At least one designated partner must be resident in India — this is worth confirming at the partner-selection stage, not after FiLLiP is rejected.
How we handle LLP registration
We check name availability against both the MCA database and the trademark register before filing, draft the LLP agreement to genuinely reflect what the partners have agreed rather than a generic template, and track the separate Form 3 deadline so it isn't missed once the Certificate of Incorporation arrives. Incorporation is handled online, so the LLP's registered office can be in any state, and partners who live abroad can take part without travelling.
Related services
Frequently asked questions
How many partners does an LLP need?
A minimum of two, at least two of whom must be designated partners, and at least one designated partner resident in India.
Is there a minimum capital requirement for an LLP?
No — partners contribute whatever amount is agreed and recorded in the LLP agreement.
Is the LLP Agreement filed at the same time as incorporation?
No — it's a separate filing (Form 3), due within 30 days of the Certificate of Incorporation, and is one of the most commonly missed early deadlines.
Does an LLP need an annual audit?
Only once its turnover or capital contribution crosses the prescribed threshold — below that, no statutory audit is required, though proper books still need to be maintained.
Can an LLP raise equity funding from investors?
Not in the way a company can — LLPs don't have shares to issue, which is why businesses planning to raise institutional equity generally choose a private limited company instead.
How is an LLP taxed compared to a company?
An LLP is taxed at a flat 30% rate, similar in structure to a partnership firm, without the tiered rates or concessional regimes available to companies.
Can an LLP later convert into a private limited company?
Yes, through a specific conversion procedure under the Companies Act — see our LLP to private limited conversion page for the process and what to consider.