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An LLP gives your business the power of a company and the ease of a partnership — legally strong, tax smart, and future-ready ideal choice for startups, consultants, and professionals.
A Limited Liability Partnership (LLP) is a modern business structure that combines the benefits of a private company (limited liability) with the operational flexibility of a partnership firm. Introduced under the LLP Act, 2008, it has become one of the most popular options for small and medium-sized businesses in India.
LLPs offer legal protection to partners, minimal compliance, and are especially ideal for professional firms, startups, and freelancers looking to scale legally and tax-efficiently.
Feature | LLP | Pvt Ltd Company | Sole Proprietorship |
---|---|---|---|
Legal Entity | ✅ Separate Entity | ✅ Separate Entity | ❌ Not Separate |
Liability | ✅ Limited | ✅ Limited | ❌ Unlimited |
Compliance | ✅ Low | ❌ High | ✅ Minimal |
Investment | ✅ Flexible | ❌ Mandatory Equity | ❌ Personal Capital |
Audit Requirement | ❌ Only if turnover > ₹40 Lakhs | ✅ Compulsory | ❌ Not Applicable |
Conclusion: LLPs hit the sweet spot between structure and simplicity.
Separate Legal Entity: LLP can own property, sue, or be sued.
Limited Liability: Partners' liability is restricted to their contribution.
No Minimum Capital: Start with as low as ₹1 capital.
Perpetual Succession: The LLP continues even after partners leave or die.
Easy Compliance: Compared to companies, LLPs have less regulatory burden.
Tax Benefits: Avoid dividend distribution tax (DDT) and no requirement to maintain books unless turnover > ₹40 lakh.
LLP is ideal for:
Startups who want legal structure but not high compliance.
Consultants, Designers, Agencies who work with corporate clients.
Freelancers offering professional services.
CA, CS, Lawyers, Doctors who operate in partnerships.
Family Businesses transitioning from informal to formal setup.
Joint Ventures with domestic or foreign partners.
Essential for all digital filings under MCA regulations
Apply via eMudhra, Sify, or other authorized providers
Submit clear, colored scans to prevent rejection delays
Valid for 2 years; personal responsibility is legally binding
Timeline: 2–3 working days
LLP Agreement defines partner roles, profit sharing, and responsibilities
Covers capital contribution, decision-making, and exit terms legally
Custom-drafted based on MCA guidelines and business needs
Ensures legal clarity under LLP Act, 2008 and avoids disputes
Timeline: 1–2 working days
LLP Incorporation legally registers your business with the Ministry of Corporate Affairs
Involves name approval, DIN & DSC setup, and filing Form FiLLiP
Includes PAN, TAN, and LLP Agreement filing for complete setup
Follows compliance under LLP Act, 2008 with government-recognized process
Timeline: 5–7 working days
PAN card (Indian) or Passport (NRI)
Aadhaar + address proof (Utility bill / Passport)
High-res color photo
Utility bill (electricity / water)
Rental agreement + NOC from landlord
Commercial or residential approvals (if applicable)
Avoid these mistakes:
Name conflict: Always cross-check MCA and trademark database
Poor quality documents: High-quality scans prevent rejections
Incomplete address proofs: Ensure documents match registered address
Delays in PAN/TAN application: Submit them immediately
Ignoring annual filings: Maintain compliance (DIR-3 KYC, AOC-4, MGT-7)
Insider Tip: We’ll remind you when filings are due post-incorporation
Factor | LLP | Pvt Ltd |
---|---|---|
Compliance | Low | High |
Ownership Transfer | Hard | Easy |
Investor Friendly | No | Yes |
Suitable For | Professionals, Consultants | Fundraising Startups |
Conversion Option | To Pvt Ltd | ❌ |
Trustworthy Structure – Appears more credible to vendors and clients.
Foreign Direct Investment (FDI) Friendly – 100% FDI allowed under automatic route.
No Dividend Tax – Only income tax is applicable. No DDT like in companies.
Scalable – Add partners, increase capital, or convert to a company later.
No Restriction on Number of Partners – Minimum 2; no maximum limit.
Separate Legal Entity: LLP can own property, sue, or be sued.
Limited Liability: Partners' liability is restricted to their contribution.
No Minimum Capital: Start with as low as ₹1 capital.
Compliance | Timeline | Form | Penalty for Non-Compliance |
---|---|---|---|
Annual Statement of Accounts | Within 30 Oct | Form 8 | ₹100 per day |
Annual Return | Within 60 days of end of FY | Form 11 | ₹100 per day |
Income Tax Return | 31 July (Audit if turnover > ₹1 cr) | ITR 5 | ₹1,000 to ₹10,000 |
LLP Agreement Filing | Within 30 days of incorporation | Form 3 | ₹100 per day |
The LLP Agreement is the legal foundation of your partnership. It defines:
Capital contribution of each partner
Profit-sharing ratios
Roles & responsibilities
Exit clauses
Dispute resolution mechanisms
💡 We draft customized, legally binding LLP agreements tailored to your business.
A Limited Liability Partnership (LLP) is a hybrid business structure combining the benefits of a partnership and a company.
Partners have limited liability, and the LLP has a separate legal identity from its owners.
LLP is ideal for professionals, service firms, consultants, agencies, and small to mid-sized businesses looking for low compliance and limited liability.
It’s also suitable for startups with no immediate plans for external funding.
You need at least 2 designated partners, both with DIN (Director Identification Number) and DSC (Digital Signature Certificate).
At least one partner must be an Indian resident.
Yes, if you want to form an LLP, registration with the Ministry of Corporate Affairs (MCA) is mandatory.
Unregistered LLPs are not recognized under Indian law.
LLP offers limited liability; traditional partnerships do not.
LLP is a separate legal entity that can own property and sue/be sued.
LLPs have centralized online registration under MCA.
You’ll need PAN, Aadhaar, address proof, photos of partners, utility bill of office, NOC from owner (if rented), and proposed name.
Also required: a signed LLP Agreement after incorporation.
It typically takes 7 to 10 working days, depending on document readiness, MCA approvals, and name availability.
Yes, a valid address in India is required for communication and documentation.
You can use a residential or commercial space, with proper proof and NOC.
File Form 11 (Annual Return) and Form 8 (Statement of Accounts)
File ITR (Income Tax Return) yearly
Audit is mandatory if turnover exceeds ₹40 lakh or contribution exceeds ₹25 lakh
No direct provision exists to convert an LLP into a Pvt Ltd company.
However, you can form a new company and transfer assets/business through legal procedures.