Designated Partner in LLP: Role, Responsibilities, and Legal Requirements

Jan 30, 2025
Private Limited Company vs. Limited Liability Partnerships

A Designated Partner in an LLP (Limited Liability Partnership) is similar to a Director in a Private Limited Company but enjoys greater rights and privileges. Introduced under the Limited Liability Partnership Act, 2008, a Designated Partner is responsible for compliance, financial management, and legal matters in an LLP. This article explains the designated partner meaning, their role, responsibilities, and privileges, helping you understand their significance in an LLP.

Table of Contents

Who Can Be a Designated Partner in LLP?

Only individuals can be Designated Partners in an LLP. As per the Limited Liability Partnership Act, 2008, a minimum of two Designated Partners is mandatory, and at least one must be an Indian resident. This designation is crucial for ensuring legal compliance, managing financial responsibilities, and fulfilling statutory obligations within the LLP.

Who Can't Be a Designated Partner?

  • Undischarged insolvents
  • Individuals declared insolvent or who have withheld creditor payments in the last five years
  • Those imprisoned for six months or more for offences involving moral turpitude
  • Minors below 18 years

The Central Government holds the authority to annul these disqualifications if deemed necessary.

Designated Partner Identification Number (DPIN)

Every Designated Partner in an LLP must obtain a Designated Partner Identification Number , also referred to as a Director Identification Number (DIN). This unique number is mandatory for LLP registration and compliance. To obtain a DPIN, you need a Class 2 digital signature, which ensures secure authentication.

All partners in an LLP are eligible to become Designated Partners, but only those specified in the incorporation document hold this role at the time of registration. The LLP Partnership Deed allows rotation of the Designated Partner role, enabling different partners to take on responsibilities with mutual consent. This flexibility ensures equal participation while maintaining compliance with LLP regulations.

Documents Required for Becoming a Designated Partner

To become a Designated Partner in an LLP, you need to apply for a Designated Partner Identification Number. For this, you must submit the following documents:

  • Identity Proof – A self-attested or certified copy of a document that includes your photograph, date of birth, and father’s or husband’s name (such as an Aadhaar card, PAN card, or passport).
  • Residential Proof – A self-attested or certified copy of an address proof like a utility bill, bank statement, or rent agreement.
  • For Nominees of a Body Corporate – A resolution or authorisation letter from the company mentioning their name and address is needed.
  • For Foreign Nationals – A valid passport copy is needed.

Authorities for Attestation/Certification

Certain officials and professionals can attest or certify documents needed for a Designated Partner Identification Number . These include:

  • Gazetted officers from the Central or State Government
  • Notaries public
  • Practicing professionals like Company Secretaries, Chartered Accountants, or Cost and Works Accountants

While attesting documents, the authority must include their name in capital letters, registration number, ministry or department details, and an official seal or stamp. This ensures the documents are valid and accepted for DPIN approval.

Translation Certificate

If your documents are in a language other than Hindi or English, you must attach a translated copy. This translation must be certified and attested to meet compliance requirements. It ensures that authorities can verify the details correctly and process the application without delays.

Appointment of Designated Partner

At least two individuals must be appointed as Designated Partners when registering an LLP. If a Designated Partner leaves the LLP, a new one must be appointed within 30 days. Failing to do so will result in all partners being considered Designated Partners, which may lead to compliance issues. To complete the appointment process, the following forms must be submitted:

To appoint a Designated Partner, the following forms must be submitted:

  • Form 9 – This form records the consent of an individual to become a Designated Partner.
  • Form 4 – It contains details of individuals who have given their consent to take on the role.
  • Form 10 – This form is used to notify any changes made by the Designated Partners.
  • Form 5 – Every LLP must submit this form to the registrar, providing details of individuals who have consented to become Designated Partners. It must be filed within 30 days of the appointment.

Related Read: What is LLP Form 11?

Government Fee for Appointment of Designated Partner

The government charges a fee based on the LLP’s contribution when appointing a Designated Partner. The fee structure is as follows:

  • ₹50 – If the LLP’s contribution is up to ₹1,00,000
  • ₹100 – If the contribution exceeds ₹1,00,000 but is limited to ₹5,00,000
  • ₹150 – If the contribution exceeds ₹5,00,000 but is limited to ₹10,00,000
  • ₹200 – If the contribution exceeds ₹10,00,000

Related Read: Complete LLP Registration Fees Guide

Duties and Responsibilities of a Designated Partner

  • Signing the Statement of Account and Solvency: The Designated Partner must sign the Statement of Account and Solvency, confirming the financial position of the LLP. This document is crucial for transparency and is filed annually.
  • Filing Annual Returns on Time: It is the Designated Partner’s responsibility to ensure that the LLP files its annual returns within 60 days of the financial year’s closure. Late filing can result in penalties and legal complications.
  • Filing Additional Documents: The Designated Partner must submit any other documents requested by regulatory authorities to comply with legal requirements.
  • Cooperating with Inspectors: During investigations or inquiries, the Designated Partner is required to cooperate with inspectors, providing necessary documents and signing examination notes to verify accuracy.
  • Reimbursing Investigation Expenses: In the case of investigations, the Designated Partner is responsible for reimbursing the costs incurred, such as those related to audits or compliance checks.

Penalty for Not Having a Designated Partner

Every LLP is required to have at least two Designated Partners at all times. Failing to comply with this requirement incurs a penalty starting at ₹10,000, which can increase to ₹5,00,000.

If a Designated Partner exits the LLP and is not replaced within 30 days, the LLP will face similar penalties. Non-compliance with this rule can lead to legal and financial consequences, making it essential for LLPs to appoint and maintain the required number of Designated Partners.

Rights of a Designated Partner

Decision-Making Rights

A Designated Partner holds significant decision-making authority within an LLP. They are involved in making key business decisions, including formulating policies, setting operational strategies, and managing the financial aspects of the LLP. Their role is vital in ensuring that the LLP functions efficiently and adheres to its business goals.

Profit-Sharing and Financial Rights

A Designated Partner is entitled to a share of the profits generated by the LLP, with the exact share determined by the LLP agreement. This agreement outlines how profits and losses are distributed among the partners, ensuring that the Designated Partner receives a portion based on their involvement and the terms set forth.

Additionally, they have financial rights concerning capital contributions and can receive distributions and benefits according to the LLP's agreed financial terms.

Right to Access LLP Records and Documents

A Designated Partner has the right to access all official records and documents of the LLP. This includes financial statements, tax filings, agreements, and any legal documents related to the firm’s operations. This right ensures transparency within the LLP, allowing the Designated Partner to make informed decisions and stay updated on the company’s financial and legal status.

Liabilities of a Designated Partner

Liabilities in Case of Non-Compliance

A Designated Partner is responsible for ensuring that the LLP complies with all relevant legal requirements. Failure to comply with regulations such as filing annual returns or paying taxes can result in penalties, fines, and legal action that impacts both the LLP and the individual partner.

Legal and Financial Liabilities Under the LLP Act

Under the LLP Act, 2008, a Designated Partner may be personally liable if the LLP violates legal obligations. This includes non-payment of statutory dues, failure to meet regulatory requirements, or failure to comply with financial disclosures. In such cases, the Designated Partner is expected to take responsibility for rectifying the situation, with potential legal and financial penalties if the issue remains unresolved.

Situations Where Personal Liability May Arise

Although an LLP offers limited liability protection, there are circumstances where a Designated Partner could be personally liable. If involved in fraudulent activities, misrepresentation, or intentionally ignoring legal obligations, the Designated Partner may face personal liability. This could result in the loss of personal assets or legal actions separate from the LLP’s legal structure.

Frequently Asked Questions

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Private Limited Company
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  • Service-based businesses
  • Businesses looking to issue shares
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Limited Liability Partnership
(LLP)

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BEST SUITED FOR
  • Professional services 
  • Firms seeking any capital contribution from Partners
  • Firms sharing resources with limited liability 

One Person Company
(OPC)

1,499 + Govt. Fee
BEST SUITED FOR
  • Freelancers, Small-scale businesses
  • Businesses looking for minimal compliance
  • Businesses looking for single-ownership

Private Limited Company
(Pvt. Ltd.)

1,499 + Govt. Fee
BEST SUITED FOR
  • Service-based businesses
  • Businesses looking to issue shares
  • Businesses seeking investment through equity-based funding


One Person Company
(OPC)

1,499 + Govt. Fee
BEST SUITED FOR
  • Freelancers, Small-scale businesses
  • Businesses looking for minimal compliance
  • Businesses looking for single-ownership

Private Limited Company
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1,499 + Govt. Fee
BEST SUITED FOR
  • Service-based businesses
  • Businesses looking to issue shares
  • Businesses seeking investment through equity-based funding


Limited Liability Partnership
(LLP)

1,499 + Govt. Fee
BEST SUITED FOR
  • Professional services 
  • Firms seeking any capital contribution from Partners
  • Firms sharing resources with limited liability 

Frequently Asked Questions

What is a designated partner in LLP?

A Designated Partner in an LLP is an individual who is appointed to manage the operations and compliance of the LLP. They are responsible for filing documents, ensuring annual returns are submitted, and managing financial and legal obligations within the business.

Who is eligible for LLP?

The eligibility to form an LLP in India is that there must be at least two partners, one of whom is an Indian resident. Partners must be between atleast 18 years of age, and both must agree to contribute capital. Additionally, obtaining a Digital Signature Certificate (DSC) and a Designated Partner Identification Number is mandatory.

What is the age limit for a designated partner?

There is no specific age limit for a Designated Partner in an LLP. However, a Designated Partner must be an adult, meaning at least 18 years old. Minors are not allowed to be Designated Partners.

What is the role of a designated member in an LLP?

The role of a Designated Partner in LLP includes signing important documents, managing the financial aspects of the LLP, ensuring legal compliance, and working on behalf of the LLP in official matters. They also handle registration, filing of annual returns, and cooperating during investigations.

Sarthak Goyal

Sarthak Goyal is a Chartered Accountant with 10+ years of experience in business process consulting, internal audits, risk management, and Virtual CFO services. He cleared his CA at 21, began his career in a PSU, and went on to establish a successful ₹8 Cr+ e-commerce venture.

He has since advised ₹200–1000 Cr+ companies on streamlining operations, setting up audit frameworks, and financial monitoring. A community builder for finance professionals and an amateur writer, Sarthak blends deep finance expertise with an entrepreneurial spirit and a passion for continuous learning.

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Related Posts

Which ITR Form is Applicable for a Company?

Which ITR Form is Applicable for a Company?

Filing an Income Tax Return (ITR) is mandatory for all companies in India, regardless of profit or business activity. Even if your company is dormant, you must comply with tax regulations. The applicable ITR form depends on factors such as income source, earnings, and business structure. Most companies file ITR-6, while ITR-5 is used for LLP companies and partnership firms. If you own a company, choosing the right ITR is essential to ensure compliance and avoid penalties. Proper company tax return filing helps meet legal obligations efficiently.

Table of Contents

Income Tax Return

An Income Tax Return is a document submitted to the Income Tax Department to report your income, deductions, and tax payments for a financial year. There are seven types of ITR forms, including ITR-1, ITR-2, ITR-3, ITR-4, ITR-5, and ITR-6, each applicable to different taxpayers. Filing ITR before the due date is essential to avoid penalties and legal issues.

Applicable ITR Forms for Companies

The type of ITR for a company depends on its structure and income classification. Different business entities must file specific ITR forms to comply with tax regulations:

  • ITR-4: Suitable for firms (excluding LLPs) with income up to ₹50 lakhs under Sections 44AD, 44ADA, and 44AE.
  • ITR-5: Applicable for LLPs and partnership firms, except those required to file ITR-7.
  • ITR-6: Used by companies that do not claim tax exemptions under Section 11 (income from property used for charitable or religious purposes).
  • ITR-7: Mandatory for entities filing under Sections 139(4A), 139(4B), 139(4C), and 139(4D), such as trusts and political parties.

ITR-4 Form (Sugam) – For Firms Other Than LLPs

ITR-4 is designed for individuals, Hindu Undivided Families (HUFs), and partnership firms (excluding Limited Liability Partnerships) that opt for the presumptive taxation scheme under Sections 44AD, 44ADA, and 44AE. This scheme simplifies tax calculations for small businesses and professionals.

Applicability Criteria:

  • Eligible Taxpayers: Individuals, HUFs, and firms (excluding  Limited Liability Partnership) with business or professional income.
  • Residency Requirement: Only applicable to a resident other than not ordinarily resident.
  • Income Sources:
    • Business income under Section 44AD (small businesses).
    • Professional income under Section 44ADA (specified professions).
    • Income from goods transportation under Section 44AE.

In certain cases, if your business meets specific conditions, you may also need to submit Form 3CA/3CB and Form 3CD for a tax audit.

ITR-5 – For LLPs and Partnerships

ITR-5 is an income tax return form applicable to Limited Liability Partnerships, partnership firms, and other non-individual entities such as Associations of Persons (AOPs), Bodies of Individuals (BOIs), artificial juridical persons, and investment funds.

These entities must file ITR-5 to report their income, deductions, and tax liabilities to the Income Tax Department. Filing this form ensures compliance with tax laws and helps avoid penalties. However, companies required to file ITR-7 cannot use ITR-5 for tax filing.

ITR-6 – For Companies That Are Not Claiming Exemption Under Section 11

ITR-6 is an income tax return form for companies that are not claiming exemptions under Section 11, which applies to income from property held for charitable or religious purposes.

Filing ITR-6 accurately is compulsory for all companies that do not qualify for exemptions under Section 11. Timely filing is essential to avoid penalties and ensure compliance.

ITR-7 – For Companies

ITR-7 is an income tax return form for companies, firms, trusts, and other entities required to file returns under Sections 139(4A), 139(4B), 139(4C), and 139(4D) of the Income Tax Act, 1961. It applies to organisations that do not qualify for other ITR categories but must still comply with tax regulations.

Entities Required to File ITR-7:

  • Registered charitable or religious trusts
  • Societies and other institutions for charitable purposes
  • Educational institutions and universities
  • Scientific research associations
  • News agencies
  • Political parties registered under Section 29A of the Representation of the People Act, 1951
  • Bodies set up for religious or charitable purposes

Filing ITR-7 is essential for these entities to comply with tax laws, report income, and claim applicable exemptions.

Details Required in an ITR Form

The information required in an Income Tax Return form depends on the type of taxpayer and income sources. However, certain key details must be included in all ITR filings.

  • Personal Information: Name, PAN, date of birth, contact details, and residential address and other personal details.
  • Income Sources: Details of salary, business or profession, capital gains, rental income, interest, and other earnings.
  • Deductions & Exemptions: Deductions and exemptions include the tax benefits you claim under different sections of the Income Tax Act, 1961.
  • Tax Payments: Information on the taxes you have already paid, such as advance tax, self-assessment tax, and Tax Deducted at Source (TDS).
  • Foreign Assets & Income: If applicable, disclosure of overseas bank accounts, investments, and earnings.

Filing an ITR with correct details ensures timely processing and avoids unnecessary scrutiny from tax authorities.

Important Deadlines for Filing Company ITR

Due Dates for Filing ITR-6

  • If audit is required under the Income Tax Act – 31st October of the assessment year.
  • If a report in Form No. 3CEB (for international transactions) is required – 30th November of the assessment year.
  • If audit is not required – 31st July of the assessment year.

Due Dates for Filing ITR-7

  • For entities not requiring an audit – 31st July of the assessment year.
  • For entities requiring an audit – 30th September of the assessment year.

It is important to note that ITR filing deadlines may change based on updates or extensions announced by the Income Tax Department. You should stay informed about official notifications to avoid missing any revised due dates.

As per Section 234F, a late filing fee of ₹5,000 is applicable if the return is filed after the due date under Section 139(1). However, if the total income is ₹5 lakh or less, the penalty is reduced to ₹1,000.

Common Mistakes to Avoid While Filing Company ITR

Incorrect Form Selection

Selecting the wrong ITR form is one of the most frequent mistakes companies make. The type of ITR form a company must file depends on its structure and nature of operations. ITR-5 is applicable for LLP and partnership firms, whereas ITR-6 is meant for most companies except those claiming exemptions under Section 11. ITR-7 is required for entities like trusts and NGOs. Filing the incorrect form can lead to rejection or discrepancies in tax assessment.

Incomplete Financial Disclosures

A company is required to disclose all sources of income, deductions, and financial transactions in its ITR. Failing to provide complete details of revenue, expenses, capital gains, investments, liabilities, and foreign assets can result in tax penalties or audits. Accurate disclosure ensures that tax authorities have a clear understanding of the company’s financial position.

Missing Audit Report Submission

Companies that meet specific turnover or income thresholds are required to undergo a tax audit as per the Income Tax Act. If a tax audit is applicable, the company must submit the audit report before filing the ITR. Missing this step can lead to legal consequences, penalties, or delays in return processing. It is important to verify whether the company falls under the audit requirement and ensure timely submission of audit reports.

Frequently Asked Questions

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Private Limited Company
(Pvt. Ltd.)

1,499 + Govt. Fee
BEST SUITED FOR
  • Service-based businesses
  • Businesses looking to issue shares
  • Businesses seeking investment through equity-based funding


Limited Liability Partnership
(LLP)

1,499 + Govt. Fee
BEST SUITED FOR
  • Professional services 
  • Firms seeking any capital contribution from Partners
  • Firms sharing resources with limited liability 

One Person Company
(OPC)

1,499 + Govt. Fee
BEST SUITED FOR
  • Freelancers, Small-scale businesses
  • Businesses looking for minimal compliance
  • Businesses looking for single-ownership

Private Limited Company
(Pvt. Ltd.)

1,499 + Govt. Fee
BEST SUITED FOR
  • Service-based businesses
  • Businesses looking to issue shares
  • Businesses seeking investment through equity-based funding


One Person Company
(OPC)

1,499 + Govt. Fee
BEST SUITED FOR
  • Freelancers, Small-scale businesses
  • Businesses looking for minimal compliance
  • Businesses looking for single-ownership

Private Limited Company
(Pvt. Ltd.)

1,499 + Govt. Fee
BEST SUITED FOR
  • Service-based businesses
  • Businesses looking to issue shares
  • Businesses seeking investment through equity-based funding


Limited Liability Partnership
(LLP)

1,499 + Govt. Fee
BEST SUITED FOR
  • Professional services 
  • Firms seeking any capital contribution from Partners
  • Firms sharing resources with limited liability 

Frequently Asked Questions

Can a company file ITR-7?

No, a company cannot file ITR-7. This form is applicable only to entities such as trusts, political parties, religious institutions, and charitable organisations that are required to file returns under Sections 139(4A), 139(4B), 139(4C), or 139(4D) of the Income Tax Act.

Can a company file ITR-4?

No, ITR-4 filing is not meant for companies. It is designed for individuals, Hindu Undivided Families, and partnership firms (excluding limited liability partnership) that opt for the presumptive taxation scheme under Sections 44AD, 44ADA, or 44AE. Companies must file either ITR-5 or ITR-6, depending on their structure.

Is ITR-3 for business income?

Yes, ITR-3 is for individuals and HUFs earning income from a proprietorship business or profession that does not fall under presumptive taxation. It also applies to those with investments in unlisted shares or income as a partner in a firm.

Who should file ITR-1 and ITR-2?

  • ITR-1 (Sahaj): This form is for resident individuals with total income up to ₹50 lakh from salary, pension, one house property, and other income (like interest). However, if you have business income, you cannot file ITR-1.
  • ITR-2: This form is for individuals and HUFs who do not have income from business or profession but may have income from capital gains, multiple house properties, foreign assets, or high earnings.

Akash Goel

Akash Goel is an experienced Company Secretary specializing in startup compliance and advisory across India. He has worked with numerous early and growth-stage startups, supporting them through critical funding rounds involving top VCs like Matrix Partners, India Quotient, Shunwei, KStart, VH Capital, SAIF Partners, and Pravega Ventures.

His expertise spans Secretarial compliance, IPR, FEMA, valuation, and due diligence, helping founders understand how startups operate and the complexities of legal regulations.

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How to Convert a One Person Company (OPC) to LLP in India

How to Convert a One Person Company (OPC) to LLP in India

As India's entrepreneurial ecosystem evolves, founders now have access to a range of legal business structures tailored to different growth stages and ownership goals. From sole proprietorships and partnerships to private limited companies and, more recently, One Person Companies (OPCs) and Limited Liability Partnerships (LLPs) are among the most popular. 

While a One-Person Company (OPC) is ideal for solo entrepreneurs starting small, many founders later seek more flexibility, lower compliance, and shared ownership, making a Limited Liability Partnership (LLP) an attractive alternative.

If you’re planning to scale or bring in partners, converting your OPC to an LLP could be the right move. This blog walks you through the concept, legal framework, and procedure for converting an OPC to an LLP in India.

Table of Contents

Limited Liability Partnership (LLP)

An LLP is a hybrid business structure that combines the benefits of a company (limited liability) with the flexibility of a partnership. Some key features include:

  • Minimum two partners required
  • Liability of partners is limited to their contribution
  • No minimum capital requirement
  • Fewer compliance requirements than a company
  • Separate legal identity from its partners

One Person Company (OPC)

Introduced under the Companies Act, 2013, an OPC allows a single individual to operate a corporate entity. It offers:

  • Limited liability
  • Separate legal identity
  • Easier fundraising compared to a sole proprietorship
  • Greater credibility in business dealings

However, OPCs face limitations like:

  • Restrictions on fundraising
  • Mandatory conversion if turnover exceeds ₹2 crore or capital exceeds ₹50 lakh
  • Cannot have more than one member

Conversion of OPC to LLP

OPC conversion to LLP is governed by the Companies Act, 2013 and the Limited Liability Partnership Act, 2008. While direct provisions for OPC-to-LLP conversion are not explicitly provided, companies (including OPCs) can be converted into LLPs under Section 366 of the Companies Act and the Second Schedule of the LLP Act.

Understanding the Legal Provisions for Conversion of OPC to LLP

The legal path for converting an OPC to an LLP involves:

  • Section 366 of the Companies Act, 2013 (deals with companies being converted into LLPs)
  • Second Schedule of the LLP Act, 2008 (provides the procedure for such conversions)
  • Form FiLLiP and Form 18 under the LLP Rules, 2009

Note: Prior approval from the Registrar of Companies (ROC) is mandatory.

Related Read: ROC Compliance Calendar for 2025–2026

Eligibility Conditions and Compliance Steps for Conversion

To be eligible for conversion:

  • Before conversion, the OPC must have at least two shareholders (LLPs require a minimum of two partners).
  • No active defaults in filing annual returns, income tax, or other statutory dues.
  • All secured creditors (if any) must give their consent.
  • The company should not have applied for winding up or struck-off status.

Compliance steps include:

  1. Holding a Board Meeting and passing a resolution for conversion
  2. Increasing the number of members/directors to meet LLP requirements
  3. Obtaining name approval through RUN–LLP or FiLLiP form
  4. Filing Form FiLLiP and Form 18 with ROC
  5. Executing an LLP Agreement within 30 days of incorporation

Looking to switch from OPC to LLP? Get professional help for a smooth and compliant business conversion with Razorpay Rize's LLP Registration Service.

Documents Furnished along with Form 18

Form 18 is the declaration for conversion and must be supported with:

  • Board resolution for conversion
  • Consent of all shareholders
  • Statement of assets and liabilities certified by a CA
  • List of creditors and their consent
  • Latest income tax return acknowledgement
  • Copy of PAN card and Aadhaar of all proposed partners
  • Address proof of the registered office of the LLP
  • NOC from the property owner (if rented office)

Procedure for Conversion of OPC to LLP

Here’s a step-by-step breakdown:

  1. Board Resolution: Approve the conversion plan and authorise directors to file the necessary forms.

  2. Increase Number of Members: Since an LLP requires at least two partners, the OPC must first induct another shareholder.

  3. DIN & DSC: Ensure all partners have a Director Identification Number (DIN) and Digital Signature Certificate (DSC).

  4. Name Approval: Apply for name reservation using RUN–LLP or through FiLLiP.

  5. Form FiLLiP Filing: File FiLLiP with ROC for incorporating the LLP.

  6. Attach Form 18: While filing FiLLiP, attach Form 18 with the required documents.

  7. Certificate of Incorporation: On approval, the ROC will issue a Certificate of Incorporation for the LLP.

  8. Execute LLP Agreement: Draft and file the LLP Agreement within 30 days.

  9. Apply for PAN, TAN & GST: Update statutory registrations with new LLP details.

  10. Close OPC Bank Account & Update Records: Close existing bank accounts of OPC and update stakeholders.

Frequently Asked Questions (FAQs)

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Register your Limited Liability Partnership in just 1,499 + Govt. Fee

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Private Limited Company
(Pvt. Ltd.)

1,499 + Govt. Fee
BEST SUITED FOR
  • Service-based businesses
  • Businesses looking to issue shares
  • Businesses seeking investment through equity-based funding


Limited Liability Partnership
(LLP)

1,499 + Govt. Fee
BEST SUITED FOR
  • Professional services 
  • Firms seeking any capital contribution from Partners
  • Firms sharing resources with limited liability 

One Person Company
(OPC)

1,499 + Govt. Fee
BEST SUITED FOR
  • Freelancers, Small-scale businesses
  • Businesses looking for minimal compliance
  • Businesses looking for single-ownership

Private Limited Company
(Pvt. Ltd.)

1,499 + Govt. Fee
BEST SUITED FOR
  • Service-based businesses
  • Businesses looking to issue shares
  • Businesses seeking investment through equity-based funding


One Person Company
(OPC)

1,499 + Govt. Fee
BEST SUITED FOR
  • Freelancers, Small-scale businesses
  • Businesses looking for minimal compliance
  • Businesses looking for single-ownership

Private Limited Company
(Pvt. Ltd.)

1,499 + Govt. Fee
BEST SUITED FOR
  • Service-based businesses
  • Businesses looking to issue shares
  • Businesses seeking investment through equity-based funding


Limited Liability Partnership
(LLP)

1,499 + Govt. Fee
BEST SUITED FOR
  • Professional services 
  • Firms seeking any capital contribution from Partners
  • Firms sharing resources with limited liability 

Frequently Asked Questions

Why convert an OPC into an LLP?

Converting to an LLP offers greater flexibility, allows multiple partners, reduces compliance burden, and enables easier capital infusion, making it suitable for scaling beyond a single founder.

Is it mandatory to get creditor consent for conversion?

Yes. Obtaining written consent from creditors is required, as their rights could be affected during the conversion process.

Can an OPC with outstanding debts be converted into an LLP?

Yes, but all creditors must be informed, and their no-objection certificates (NOCs) must be secured. The LLP will assume all debts and liabilities of the OPC post-conversion.

Will the new LLP retain the OPC’s assets and liabilities?

Yes. Upon conversion, all assets, liabilities, obligations, and agreements of the OPC automatically vest in the LLP.

Do tax implications arise during conversion?

If the conversion meets certain conditions under the Income Tax Act (e.g., continuity of business and ownership), it can be tax-neutral. Otherwise, capital gains tax or other liabilities may apply. It’s advisable to consult a tax expert.

Mukesh Goyal

Mukesh Goyal is a startup enthusiast and problem-solver, currently leading the Rize Company Registration Charter at Razorpay, where he’s helping simplify the way early-stage founders start and scale their businesses. With a deep understanding of the regulatory and operational hurdles that startups face, Mukesh is at the forefront of building founder-first experiences within India’s growing startup ecosystem.

An alumnus of FMS Delhi, Mukesh cracked CAT 2016 with a perfect 100 percentile- a milestone that opened new doors and laid the foundation for a career rooted in impact, scale, and community.

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Filing LLP Form 24: How to Close Your LLP in India

Filing LLP Form 24: How to Close Your LLP in India

A Limited Liability Partnership (LLP) combines the benefits of a partnership and a company, making it an attractive choice for entrepreneurs. It offers key advantages such as:

  • Separate Legal Entity: An LLP has its own legal identity, distinct from its partners.
  • Limited Liability: The liability of partners is limited to their agreed contribution.
  • Tax Benefits: LLPs enjoy certain tax advantages compared to companies.

Despite these benefits, there may come a time when an LLP needs to be closed. This blog explains the step-by-step process of LLP closure.

Table of Contents

Closure of LLP - Overview

The Limited Liability Partnership (LLP) closure process is a significant decision that can arise from various circumstances. Whether driven by voluntary factors, such as a mutual decision by the partners to discontinue operations, or involuntary factors, like non-compliance with statutory requirements, understanding the reasons and methods of closure is crucial.

The decision to close an LLP often stems from the following reasons:

  1. Voluntary Closure:
    Partners may mutually agree to cease operations due to business inactivity, an unprofitable venture, or a strategic shift in focus. This proactive decision is usually taken when all stakeholders conclude that continuing operations no longer align with their goals.
  2. Involuntary Closure:
    Sometimes, an LLP faces closure due to external circumstances such as non-compliance with legal or regulatory obligations, accumulation of penalties, or other statutory violations. In such cases, authorities may initiate the process of striking off the LLP from the official records.

Method or Procedure of Closing an LLP

Closing a Limited Liability Partnership (LLP) in India can be carried out through two primary methods: Voluntary Winding Up and Striking Off. Each method has its unique set of requirements, advantages, and limitations. Choosing the right approach depends on the LLP’s operational and financial status. Let’s look into the details of these two LLP closing procedures:

1. Voluntary Winding Up

Voluntary winding up is a process initiated by the partners when they collectively decide to dissolve the LLP. This method is typically chosen when the partners agree to cease operations due to inactivity, unprofitability, or a strategic decision to exit.

Advantages of Voluntary Winding Up:

  • Controlled and Planned Process
  • Avoids Penalties for Non-Compliance

Disadvantages of Voluntary Winding Up:

  • Time-Consuming
  • Settlement of Liabilities Required

2. Striking Off

Striking off is a simpler and faster method for closing an LLP. It is suitable for LLPs that have been inactive for a significant period and have no outstanding liabilities. This process involves applying to the RoC to remove the LLP’s name from the register.

Advantages of Striking Off:

  • Simplified and Less Expensive
  • Suitable for Dormant LLPs

Disadvantages of Striking Off:

  • Not Applicable for LLPs with Liabilities
  • Limited Scope for Active LLPs

Step-by-Step Procedure to Close an LLP

A brief overview of the process for closure of LLP in India:

1. Passing a Resolution for Winding Up

The first step is for the partners to pass a resolution for voluntary winding up. A majority of partners must agree, and the resolution must be filed with the ROC within 30 days.

2. Appointing a Liquidator

The partners must appoint a liquidator to oversee the winding-up process. The liquidator’s role includes realising the LLP’s assets and settling its liabilities.

3. Realising Assets and Paying Off Liabilities

The liquidator identifies and sells the LLP’s assets to clear all outstanding liabilities. Surplus funds, if any, are distributed among the partners.

4. Filing the Necessary Forms with the ROC

The LLP must file forms such as Form 24 and other requisite filings with the ROC to notify the authorities about the closure.

5. Obtaining the Final Order of Dissolution

After reviewing all filings and confirming the settlement of liabilities, the ROC issues a final order of dissolution, formally closing the LLP.

Filing LLP Form 24: Step-by-Step Process

Closing a Limited Liability Partnership (LLP) in India requires filing LLP Form 24 with the Ministry of Corporate Affairs (MCA). Below is a simplified step-by-step process to help you navigate this procedure:

1. Cease Business Operations

Before applying for closure, ensure that the LLP has either never commenced business or has stopped all commercial activities. If your LLP is still active, suspend all operations before proceeding.

2. Settle Liabilities and Close Bank Accounts

LLP Form 24 can only be filed if the LLP has no outstanding creditors and all bank accounts are closed. Obtain a closure letter from the bank as proof.

3. Draft Partner Affidavits

All designated partners must prepare an affidavit declaring:

  • The LLP has ceased operations from a specific date or never started.
  • The LLP has no liabilities, and partners agree to indemnify any future claims.

4. Prepare Supporting Documents

Attach the following documents to LLP Form 24:

  • Copy of the latest Income Tax Return (if filed). If no returns were filed, this is not required for non-operational LLPs.
  • A statement of accounts showing nil assets and liabilities, certified by a Chartered Accountant, dated no more than 30 days before filing.

5. Resolve Pending Filings

Ensure that:

  • The LLP Agreement is filed, if not already done.
  • Any overdue Form 8 and Form 11 are submitted up to the date of cessation of business.

6. File LLP Form 24 with MCA

Submit the completed LLP Form 24 with all attachments to the MCA. Once reviewed, a notice of striking off will be published on the MCA website if no objections are raised.

Documents Required to Close the LLP

Here is a list of LLP closure documents required during the process:

  • Board Resolution for Winding Up: Document signed by all partners approving the winding-up process.
  • Liquidator’s Consent: Written consent from the appointed liquidator.
  • No-Objection Certificate from Creditors: If applicable, creditors must provide a no-objection certificate.
  • Final Accounts and Balance Sheet: Statement of accounts showing all liabilities cleared.
  • Tax Clearance Certificates: Certificate from the tax authorities confirming no pending dues.

 Conditions for LLP Closure

Certain conditions must be met before initiating the LLP closure process:

  • Settlement of Debts and Liabilities: All outstanding debts and liabilities must be cleared.
  • Statutory Filings: All statutory filings and compliance requirements must be up-to-date.
  • Approvals: Necessary approvals from all partners and creditors (if applicable) must be obtained.

Advantages and Disadvantages of LLP

Like any business entity, an LLP has its own advantages and disadvantages that should be carefully considered before choosing this structure.

Advantages of an LLP

  1. Limited Liability: The liability of partners is limited to their agreed contribution to the business, protecting personal assets in case of business debts or losses.
  2. Separate Legal Entity: An LLP is a separate legal entity from its partners, meaning it can own assets, enter into contracts, and sue or be sued independently.
  3. Flexibility in Management: There is no strict separation between ownership and management, allowing partners to manage the business as per their agreement.
  4. No Minimum Capital Requirement: Unlike private limited companies, LLPs do not have a minimum capital requirement, making them more accessible to small businesses and startups.
  5. Ease of Compliance: LLPs have fewer compliance requirements compared to companies, such as no mandatory board meetings or annual general meetings.
  6. Unlimited Number of Partners: An LLP can have any number of partners, offering greater flexibility in expanding ownership.
  7. Low Registration Cost: Setting up an LLP is more affordable than incorporating a private limited company.

Disadvantages of an LLP

  1. Limited Recognition: LLPs are not as widely recognised as private limited companies, which may affect investor confidence or business collaborations.
  2. Restrictions on Fundraising: LLPs cannot raise funds through equity, making them less suitable for businesses looking to attract venture capital or private equity investment.
  3. Limited Scope for Public Trust: LLPs are not listed on stock exchanges, so they may lack the transparency that comes with publicly traded companies, leading to lower public trust.
  4. Difficulty in Expansion: LLPs are not ideal for businesses aiming for rapid scalability, as the inability to issue shares limits their access to growth capital.

An LLP is an excellent choice for small businesses, professionals, and startups looking for a flexible, cost-effective business structure with limited liability. However, it may not be suitable for companies that require significant funding or aspire to scale rapidly. 

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Frequently Asked Questions

How do I close my LLP account?

To close your LLP account, follow these steps:

  1. Settle liabilities
  2. Pass a resolution
  3. File necessary documents
  4. Notify creditors & obtain consent (if any)
  5. Get Registrar’s approval

What is the process of leaving an LLP?

If an individual partner wants to leave an LLP, the process is as follows:

  1. Review the LLP Agreement
  2. Notify Other Partners
  3. Execute a Deed of Retirement
  4. File Form 3 and Form 4
  5. Update Bank and Other Records

Can an LLP be restored after its winding up?

Yes, an LLP can be restored after it has been struck off, but only under specific circumstances. The process is:

  1. Apply to the National Company Law Tribunal (NCLT) for restoration within three years of the LLP being struck off.
  2. Provide valid reasons for seeking restoration, such as business resumption or wrongful closure.
  3. Ensure all pending annual returns, financial statements, and fees are filed with the RoC.
  4. If the tribunal is satisfied, it will issue an order to restore the LLP. The RoC will then update its records accordingly.

What complications of non-compliance you may need to face during the LLP winding-up process?

Non-compliance can lead to several challenges when winding up an LLP:

  1. Heavy penalties
  2. Legal issues
  3. Delay in the winding-up process
  4. Blacklisting & disqualification

How long does an LLP winding-up process take?

The duration of the winding-up process depends on the method and circumstances:

  • Voluntary Winding Up typically takes 4 to 6 months, depending on the completion of filings, approvals, and liability settlements.

Striking Off can be completed within 3 to 4 months if the LLP has no liabilities or pending compliance issues.

Nipun Jain

Nipun Jain is a seasoned startup leader with 13+ years of experience across zero-to-one journeys, leading enterprise sales, partnerships, and strategy at high-growth startups. He currently heads Razorpay Rize, where he's building India's most loved startup enablement program and launched Rize Incorporation to simplify company registration for founders.

Previously, he founded Natty Niños and scaled it before exiting in 2021, then led enterprise growth at Pickrr Technologies, contributing to its $200M acquisition by Shiprocket. A builder at heart, Nipun loves numbers, stories and simplifying complex processes.

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