A Limited Liability Partnership (LLP) may prove to be a much superior business structure than a regular partnership. LLP have minimal compliances, tax benefits, limited liability, separate legal entity, no audit requirements below a certain capital, no cap with regard to the number of partners etc.
Nowadays partnership firms are being converted into a Limited Liability Partnership (LLP). LLP offers a bunch of great features such as limited liability protection, transferability, unlimited partners, survivability etc., making LLP structure more attractive than a partnership firm.
What are the requirements for conversion?
- Partners of the partnership firm will remain the partners in new LLP, and those who do not wish to continue to be the partner in LLP should retire.
- New partners who want to add themselves in LLP, should be added after the incorporation of LLP
- All the designated partners should be updated with their income tax returns
- All designated partners must apply for DSC
- All designated partners must apply for DIN or DPIN
- All designated partners must make contributions
- All creditors must give their consent for conversion