Partnership/LLP Registration

Partnership / LLP Company Registration

Contact Tax Mother today for expert guidance on registering your partnership company or LLP and maximizing your business's potential.

Choosing the right business structure is crucial for long-term success. Whether you opt for a partnership company, LLP, or Partnership LLP, understanding their key features and registration processes empowers you to make informed decisions.

For personalized guidance and assistance in registering your partnership company, LLP, or Partnership LLP, contact Tax Mother, your trusted tax and business advisory partner.

Partnership Companies vs. LLPs

Choosing the Right Business Structure:

When it comes to starting a business, choosing the right structure is a critical decision that can significantly impact your success. Partnership companies and Limited Liability Partnerships (LLPs) are two popular options that offer distinct advantages to entrepreneurs.

Understanding the key features and registration processes of these structures is essential for aspiring business owners who seek to unlock their company’s full potential. In this article, we will explore partnership companies and LLPs, highlighting their unique benefits and providing a comprehensive guide to help you make an informed choice for your business. Discover how you can establish a solid foundation for growth and protect your interests by selecting the optimal structure that aligns with your vision and goals.

Partnership Companies & Registration Process

Empowering Collaboration and Growth

Partnership companies, similar to sole proprietorships, distinguish themselves through the involvement of multiple individuals. With clear delineation of responsibilities outlined in the partnership agreement, these businesses foster collaboration and shared decision-making.

Benefits of Partnership Companies:

Efficient fundraising due to enhanced credibility in the eyes of financial institutions.
Improved accountability through shared responsibility among partners.

Registration Process for Partnership Companies:

Form 1 statement
Partnership Deed copy: Includes company name, business operations, primary and additional locations, partnership date, partners’ details, and business structure.
Partners’ PAN card and Aadhar card/Voter ID card.
Proof of business location ownership/rent/lease.
Sign and agree upon the partnership deed, which acts as a legal agreement governing the partnership.

Limited Liability Partnerships (LLPs) & Registration Process

Secure and Versatile Structures

LLPs offer business owners the advantage of separating personal and business assets, ensuring ultimate limited liability protection. Liability is based on the amount of share capital allocated to each partner, making it a flexible and secure business structure.

Benefits of LLPs:

Protection of personal assets from business liabilities.
Suitable for small and medium enterprises (SMEs).
Lower registration costs compared to private limited or public limited companies.
Reduced compliance obligations, with only the filing of annual return statements and statements of account being mandatory.

Registration Process for LLPs:

PAN card or identity proof (Aadhar Card, Driver’s License, or Voter ID).
Address proof documents such as bank statements, phone bills, mobile bills, and gas bills.
Passport-size photocopies.
Passport (for foreigners or NRIs).
DSC (Digital Signature Certificate) and registered office address proof.

Follow the step-by-step LLP registration process:

Obtain Digital Signature Certificates (DSC) and Director Identification Numbers (DIN) for LLP partners.
Apply for business name approval through the Ministry of Corporate Affairs (MCA).
Upon approval, submit the necessary paperwork within 60 days.
Receive the registration certificate and apply for the Partnership Agreement within 30 days.

A Detailed Comparison Between Companies

Basis	Proprietorship Firm	Partnership Firm	Private Limited Company	Public Limited Company	Limited Liability Partnership
Prevailing Law	No specific law	Indian Partnership Act, 1932	Companies Act, 2013	Companies Act, 2013	Limited Liability Partnership Act, 2008
Capital Required	No minimum amount	No minimum amount	No minimum amount (Standard 1 Lakh for Pvt. Ltd. Company)	Minimum authorized and subscribed capital required	No minimum amount
Name of Entity	Any name as per choice	Any name as per choice	Name to contain ‘Private Limited’ as suffix	Name to contain ‘Limited’ as suffix	Name to contain ‘Limited Liability Partnership’ or ‘LLP’ as suffix
Procedure	KYC of Proprietor	KYC of All Partners	KYC of All Directors	KYC of All Directors	KYC of All Partners
Apply Tax Registration	Prepare, Sign & Notarize Partnership Deed	Apply for Digital Signature of Directors	Apply for Digital Signature of Directors	Apply for Digital Signature of Partners
Approval and Ready	Apply to Registrar of Firms	Apply for DIN of Directors	Apply for DIN of Directors	Apply for DIN of Partners
Apply Pan Card	Apply for RUN for Name Approval	Apply for RUN for Name Approval	Apply for Name Approval with Form 1
Approval, Pan Generated & Ready	Prepare MOA, AOA & Other Incorporation Documents	Prepare MOA, AOA & Other Incorporation Documents	Prepare Partnership Agreement & Other Incorporation Documents
File SPice+ with MCA	File SPice+ with MCA	File Form 2 & 3 with MCA
Approval with COI, PAN, TAN & GST	Approval with COI, PAN, TAN & GST	Approval with COI, PAN, TAN & GST
Pre-Approval of Name	Not Required	Not Required	Required	Required	Required
Registration	Any Tax Registration will suffice	Optional with Registrar of Firms	Registration with Registrar of ROC required (MCA)	Registration with Registrar of ROC required (MCA)	Registration with Registrar of LLP required (MCA)
Creation	N/A (Not a separate legal entity)	Created by contract with 2 persons	Created by Law	Created by Law	Created by Law
Distinct Entity	Not a separate legal entity	Not a separate legal entity	Is a separate legal entity under the Companies Act, 2013	Is a separate legal entity under the Companies Act, 2013	Is a separate legal entity under the Limited Liability Partnership Act, 2008
Compliance Complexity	Minimal	Moderate	High	High	Moderate
Number of Directors	Not applicable	Not applicable	Minimum 2 Directors	Minimum 3 Directors	Minimum 2 Designated Partners
Statutory Audit Requirement	Not applicable	Not applicable	Applicable (based on turnover and other thresholds)	Applicable (based on turnover and other thresholds)	Applicable (based on turnover and other thresholds)
Mandatory Annual Filings	No Annual Filings required	No Annual Filings required	Mandatory (Annual Returns, Financial Statements, etc.)	Mandatory (Annual Returns, Financial Statements, etc.)	Mandatory (Annual Returns, Financial Statements, etc.)
Ownership Transferability	Not possible	Not possible	Possible	Possible	Possible
Foreign Ownership	Not allowed	Allowed	Allowed	Allowed	Allowed
Admission as Partner/Member	Not applicable	By agreement	By agreement	By agreement	By agreement
Annual Filing	Not applicable	Not applicable	Yes	Yes	Yes
Cessation as Partner/Member	Not applicable	By agreement	By agreement	By agreement	By agreement
Charter Document	Not applicable	Partnership Deed	Memorandum of Association and Articles of Association	Memorandum of Association and Articles of Association	LLP Agreement
Common Seal	Not applicable	Optional	Optional	Mandatory	Not applicable
Compliances	Few	Moderate	More	More	Moderate
Contracts	Personal liability	Joint liability	Limited liability	Limited liability	Limited liability
Credit Worthiness of Organization	Personal credit	Partners’ credit	Separate entity’s credit	Separate entity’s credit	Separate entity’s credit
Digital Signature	Not applicable	Not applicable	Required for filing	Required for filing	Required for filing
Director Identification Number	Not applicable	Not applicable	Required for directors	Required for directors	Not applicable
Dissolution	Not applicable	By agreement	By legal process	By legal process	By agreement
Dividend Distribution Tax	Not applicable	Not applicable	Yes	Yes	Not applicable
Formalities of Incorporation	Not applicable	Not applicable	Required	Required	Required
Legal Proceedings	Personal liability	Joint liability	Limited liability	Limited liability	Limited liability
Liability of Partners/Members	Unlimited	Jointly and severally	Limited	Limited	Limited
Maintenance of Minutes	Not applicable	Not applicable	Required	Required	Not applicable
Number of Members	Single owner	Minimum 2	Minimum 2	Minimum 7	Minimum 2
Oppression and Mismanagement	Not applicable	Applicable	Applicable	Applicable	Applicable
Ownership of Assets	Personal ownership	Joint ownership	Company ownership	Company ownership	LLP ownership
Perpetual Succession	Not applicable	Not applicable	Yes	Yes	Yes
Principal/Agent Relationship	Not applicable	Partners act as agents	Directors act as agents	Directors act as agents	Partners act as agents
Share Certificate	Not applicable	Not applicable	Issued to shareholders	Issued to shareholders	Not applicable
Statutory Meetings	Not applicable	Not applicable	Required	Required	Not applicable
Tax Liability	Individual tax rates	Partnership tax rates	Corporate tax rates	Corporate tax rates	Partnership tax rates
Transfer of Share/Partnership rights in case of death	Not applicable	By agreement	By transfer of shares/partnership interest	By transfer of shares/partnership interest	By agreement
Voting Rights	Not applicable	As per agreement	Proportional to shareholding	Proportional to shareholding	As per agreement
Accounting Standards	Personal discretion	Partners’ discretion	Required by law	Required by law	Required by law
Annual Compliance Cost	Low	Moderate	High	High	Moderate
Audit of Accounts	Not applicable	Not applicable	Required	Required	Required
Board Meetings	Not applicable	Not applicable	Required	Required	Not applicable
Books of Account	Personal records	Partnership records	Mandatory	Mandatory	Mandatory
Borrowing	Personal capacity	Joint capacity	Limited capacity	Limited capacity	Limited capacity
Conversion	Not applicable	Possible	Possible	Possible	Possible
Foreign Member	Not applicable	Possible	Possible	Possible	Possible
Foreign Participation	Not applicable	Possible	Possible	Possible	Possible
GST Applicability & Rates	Personal capacity	Partnership capacity	Corporate capacity	Corporate capacity	Partnership capacity
Income Tax	Individual tax rates	Partnership tax rates	Corporate tax rates	Corporate tax rates	Partnership tax rates
Legal Status	Personal	Joint	Separate legal entity	Separate legal entity	Separate legal entity
Liability Limitation	No	Joint liability	Limited liability	Limited liability	Limited liability
Managerial Personnel	Not applicable	Not applicable	Required	Required	Not applicable
Merger-Amalgamation	Not applicable	Not applicable	Possible	Possible	Not applicable
Min vs Max No of Directors	1 to N/A	2 to N/A	2 to 15	3 to 15	2 to N/A
Min vs Max No of Shareholders/Members	1 to N/A	2 to N/A	2 to 200	7 to unlimited	2 to N/A
Min vs Max Revenue/Year	N/A	N/A	Varies	Varies	N/A
Name Approval	Not applicable	Not applicable	Required	Required	Required
Owners Remuneration	Personal discretion	As per agreement	Permissible	Permissible	Permissible
Remuneration of Managerial Personnel	Not applicable	Not applicable	Regulated	Regulated	Not applicable
Start Up India	Not applicable	Not applicable	Eligible	Eligible	Not applicable
Startup Accreditation	Not applicable	Not applicable	Eligible	Eligible	Not applicable
Transfer/Inheritance of Rights	Not applicable	By agreement	By transfer of shares/partnership interest	By transfer of shares/partnership interest	By agreement
Transferability	Not applicable	By agreement	By transfer of shares	By transfer of shares	By agreement

When establishing a successful business, choosing the right structure is vital. Whether it’s a partnership company, LLP, or Partnership LLP, understanding their features and registration process empowers informed decisions. For smooth and efficient registration, rely on Tax Mother, your trusted tax and business advisory partner for Partnership LLP registration assistance.

Contact us for your Partnership or LLP Registration