Short answer: an LLP needs two partners, has no minimum capital requirement, and — the part that actually matters — needs no statutory audit while turnover stays under ₹40 lakh and contribution under ₹25 lakh (Rule 24, LLP Rules, 2009). Registration takes roughly 10 to 20 working days. Two annual filings, no board meetings, no AGM.
Why founders actually choose an LLP
Not because it is cheaper to register. The registration cost difference against a private company is modest.
It is because of the annual running cost. A private limited company appoints a statutory auditor from year one regardless of turnover — section 139 does not care that you billed ₹6 lakh. An LLP below those thresholds does not. For a genuinely small business that is a real, recurring saving, every year.
The trade-off is equally clear: an LLP is a poor vehicle if you will raise investment or issue ESOPs. Investors buy shares, and an LLP has none. If either is on your horizon, read Pvt Ltd vs LLP vs OPC or use the entity chooser before you file anything.
Who it suits
- Two or more partners sharing profits, with no plan to raise outside equity
- Professional services firms, consultancies, agencies, trading businesses
- Family businesses wanting limited liability without company compliance
- Anyone whose honest answer to “how much annual compliance can I keep up with?” is “not much”
What you get
- Certificate of Incorporation with your LLPIN
- PAN and TAN for the LLP
- DPIN for each designated partner
- Digital Signature Certificate for each designated partner
- LLP Agreement drafted and filed in Form 3
That last item has a hard deadline. See below.
The process
1. Digital Signature Certificates — 1 to 2 days
Each designated partner needs one before anything can be filed.
2. Name reservation (RUN-LLP) — 2 to 3 days
Same rule as companies: your name must not clash with an existing entity or a registered trademark. Submit a second choice.
3. Incorporation filing (FiLLiP) — 5 to 10 days
Carries partner details, the registered office, and the contribution amount. DPIN is allotted through this form for first-time partners.
4. Certificate of Incorporation
Your LLP legally exists from this date.
5. LLP Agreement — Form 3, within 30 days
This is the one people miss. The agreement governs profit sharing, decision-making, admission and exit of partners, and what happens in a dispute. It must be filed within 30 days of incorporation.
A generic template agreement is a false economy. The clauses that matter are the ones you only read when the partnership is going badly.
Realistic total: 10 to 20 working days.
Documents you need
Every designated partner
- PAN card
- Aadhaar card
- One photo ID — passport, voter ID or driving licence
- One address proof — bank statement or utility bill, dated within the last two months
- Passport-size photograph
- Personal email and mobile for OTPs
Registered office
- Recent utility bill, within two months
- Rent agreement or ownership proof
- NOC from the property owner
A residential address is acceptable.
> Minimum two designated partners, and at least one must be resident in India.
What it costs
Four components, and you should see them separated:
| Component | What drives it |
|---|---|
| Government fees | Your contribution amount |
| Stamp duty on the LLP Agreement | A state subject — varies by state and contribution |
| DSC | One per designated partner |
| Professional fee | Ours. Fixed and in writing before work starts |
As with companies, stamp duty being state-specific means there is no honest single all-India number. We give you the split in writing before you pay.
Annual compliance — what you are signing up for
Lighter than a company, but not nothing. Two filings, both mandatory regardless of turnover or whether you traded at all:
| Form | What it is | Due |
|---|---|---|
| Form 11 | Annual Return | 30 May |
| Form 8 | Statement of Account & Solvency | 30 October |
Plus DIR-3 KYC by 30 September for every partner holding a DIN, and an income tax return.
Delayed LLP filings attract an additional fee per day of delay. The rates differ for small LLPs, and we will give you the exact figure for your case rather than a number that might be out of date.
The trap: founders assume a dormant LLP has nothing to file. It does. Form 11 and Form 8 are due every year whether you traded or not, and the additional fee accrues just the same.
Audit — the threshold that decides your running cost
No statutory audit required where turnover does not exceed ₹40 lakh and contribution does not exceed ₹25 lakh (Rule 24, LLP Rules, 2009).
Cross either one and audit becomes mandatory, and your annual cost moves closer to a company’s. Worth modelling before you choose the structure — and worth watching as you grow.
Not sure where you stand?
Already registered and unsure what is due? The free compliance deadline check turns your incorporation date into your full filing schedule and flags what is overdue.
Ask us on WhatsApp — tell us your state and intended contribution and we will send the exact figure.
Frequently asked questions
How many partners do I need?
Two designated partners minimum, at least one resident in India. No upper limit.
Is there a minimum capital?
No. There is no prescribed minimum contribution for an LLP.
Can an LLP be converted to a private limited company later?
Yes, and it is done regularly. It costs time and money, and it tends to become urgent exactly when you are busiest — which is the argument for choosing correctly at the start if you already suspect you will raise.
Do I need to file if the LLP had no business?
Yes. Form 11 and Form 8 are due every year regardless of activity. This is the single most common cause of LLP penalties we see.
Can a company be a partner in an LLP?
Yes, a body corporate can be a partner. It must nominate an individual to act as designated partner.
How is an LLP taxed?
An LLP is taxed as a firm, not a company. Get specific advice on your situation — the rate and treatment depend on facts this page cannot see.
Written by CS Anchal Rai, Partner at Vittara Global Advisory LLP. General information, not professional advice. Rules change — confirm for your specific case before acting.
