Before you become a partner in an LLP things you should know
What you know is right, to incorporate an LLP you need two or more persons with a view to becoming only subscribers of profit that the business would make. But, before you become partner in LLP things you should consider knowing is covered in this blog. Remember, to register an LLP you would need a professional, and having a qualified professional on your side while incorporating is the best you could do, we at Wazzeer are experts in this matter.
Who can become a partner in an LLP?
Any individual or corporate body can become a partner of LLP, provided:
- Individual with sound mind as per the Court of competent jurisdiction
- Individual is not adjunct under any grounds
How many partners can an LLP consist of?
Minimum of 2 partners and maximum could be any number. If at any time the number of partners of an LLP is reduced below two, yet the LLP continues to carry out business for than 6 months, the partner who runs business during that period is liable for all LLP activities.
If you think this is so simple, the true game changer is coming up: Designated Partner Vs Partner
Every LLP should consist of at least two designated partners who are individuals and at least one of them should be Indian resident. Other partners are more like shareholders.
The Designated partners:
- Are like directors of the firm
- Are responsible for the LLP being fully compliant
- Are liable to all penalties imposed on LLP
- Are the authority who executes, manages, and decides for the LLP
To be a Designated Partner: This would be carried out in accordance with LLP Agreement
- As a partner, you should give prior consent to LLP
- File with the registrar the particulars of every individual within 30 days of appointment
- Obtain Designated Partner Identification Number (DPIN) now called dIn from the central government.
- If the Body corporate wishes to be a Body corporate it has to appoint a nominee to act as a Designated Partner on behalf of the Body corporate.
Note: In case Foreign Body Corporate or Foreigner is involved in an LLP, the funds transferred by this foreign source are allowed in only those sectors where 100% FDI is allowed.
Remember, the LLP Agreement is the rulebook and the game has to be played in accordance with this holy rule book.
Wazzeer has helped over hundreds of LLPs starting from incorporation till fundraising compliance, we would be very happy to serve you. Let’s connect to build a success story.