Introduction

The flexibility of a partnership and the limited liability protection of a company structure are combined in the form of limited liability partnership (LLP). Each partner in an LLP is responsible for their own debts and responsibilities. In LLP other partners are not held personally accountable for the debt if one partner is sued.

People are choosing to change their business structure from Company to LLP because LLP offers corporate structuring with benefits of partnership.

Key Features

Limited Liability Partnerships (LLPs) are a hybrid business structure that combines the feature of partnership firm and company.

According to the Limited Liability Partnership Act, 2008 (LLP Act), a limited liability partnership (LLP) is a body corporate formed and incorporated under the Act and is a legal entity separate from that of its partners. The liability of the partners is limited to their respective shares in the LLP's assets.

· LLP is created through a partnership agreement be signed by two or more people and it must be registered with the Registrar of Companies.

· All the mutual rights and liabilities of partners are governed by LLP agreement including its objectives, duties, manner of induction and cessation, termination and other important clause.

· Minimum two designated partners are required to form a LLP

· An LLP's name must conclude with "limited liability partnership" or the abbreviation "LLP."

· The amount of capital that the partners have agreed to contribute to the LLP is known as the registered capital of an LLP.

· The management of an LLP is vested in the partners

Reasons for Conversion of Company into LLP

Although consideration of converting any company into an LLP is dependent on a number of criteria, including corporate structure, management, and the flexibility of operations, this conversion has a number of advantages that are listed below:

· As a result of the introduction of new corporate governance practises for Companies, regulatory agencies are gradually becoming stricter.

· LLPs provide greater managerial and decision-making flexibility than companies.

· LLPs provide their partners with limited liability protection, which means they are not personally responsible for the LLP's debts.

· Comparatively, the statutory requirements for LLPs are less stringent than those that must be met by any company

· The income and losses of an LLP are distributed to the partners and taxed on their individual tax returns since LLPs are treated as pass-through entities for tax purposes

Documents required

What is included in this

1. Ascertain Eligibility Criteria
2. LLP Agreement
3. Documents preparations for conversion
4. Filing of E forms at MCA portal
5. 24*7 Mail Support;

FAQ’s

1. What is LLP?

A partnership that has been officially registered under the Limited Liability Partnership Act of 2008 and whose members have agreed to carry out a certain goal as stated in the Limited Liability Partnership Agreement.

2. What is LLP Agreement?

A written agreement between the partners of a limited liability partnership (LLP) is known as an LLP agreement or limited liability partnership agreement. It describes the rules and regulations that will control the LLP as well as the partners' rights and obligations.

3. What is the difference between LLP and Company?

Few differences between LLPs and companies are listed below:

4. What E forms are required for conversion of Company into LLP?

· E form MGT-14: For filing special resolution passed at general meeting

· Web form RUN_LLP: For name approval

· Form FiLLiP: For LLP incorporation

· E form 18: For application of conversion

· E form 14: For information on conversion

· Eform 3: For information on LLP agreement

5. What are the conditions of conversion?

· All shareholders of the Company should become partners of LLP and no else cannot be partner at the time of application.

· There should be no security interest in its assets subsisting or in force at time of conversion application.

· All applicable clearances, approvals and permissions for conversion of the Company into LLP to be obtained.

· Consent of all creditors has been obtained.

· Provision with respect to submission of returns and annual accounts under Companies Act,2013 should be complied.

6. What are the compliances after conversion?

· Change in Sign Board, Letter head, stationary and other items where old name as Company used to be displayed

· Application to update name in PAN.

· Intimation and application to other authorities where Company is registered i.e. GST, EPF, ESI etc.

· Intimation to various suppliers and parties with whom Company has business.

· Intimation to banks where Company is maintaining bank accounts.