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Pune Camp CPE Study Circle

Pune Camp CPE Study Circle. Formation of Limited Liability Partnership. CA Neeraj Menon Partner Shah Khandelwal Jain & Associates, Chartered Accountant. Presentation Flow: Salient Features of LLP Advantages of forming LLP Steps to form LLP General Points to be covered in LLP agreement.

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Pune Camp CPE Study Circle

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  1. Pune Camp CPE Study Circle Formation of Limited Liability Partnership CA Neeraj Menon Partner Shah Khandelwal Jain & Associates, Chartered Accountant

  2. Presentation Flow: • Salient Features of LLP • Advantages of forming LLP • Steps to form LLP • General Points to be covered in LLP agreement CA Neeraj Menon Partner Shah Khandelwal Jain & Associates, Chartered Accountant

  3. SALIENT FEATURES CA Neeraj Menon Partner Shah Khandelwal Jain & Associates, Chartered Accountant

  4. Salient Features of LLP… A separate legal entity No liability of partner on account of independent or un-authorized actions of other partners No element of agency involved Liability of partner restricted to contribution made LLP a body having a perpetual succession Minimum 2 partners required to form LLP No limit for maximum number of partners Foreign entities can also form LLP CA Neeraj Menon Partner Shah Khandelwal Jain & Associates, Chartered Accountant

  5. Salient Features of LLP… Atleast TWO designated partners required for compliance under LLP Act In LLP formation atleast ONE designated partner should be a resident of India Taxation: Similar to partnership firms - Maximum Marginal rate of 30% CA Neeraj Menon Partner Shah Khandelwal Jain & Associates, Chartered Accountant

  6. ADVANTAGES OF LLP CA Neeraj Menon Partner Shah Khandelwal Jain & Associates, Chartered Accountant

  7. Advantages of LLP… Vis-à-vis COMPANY: Cost of formation is lesser than a company Lesser compliance level compared to company No Minimum Alternate Tax (MAT) No Dividend Distribution Tax (DDT) Vis-à-vis PARTNERSHIP: Better credentials in the eyes of Financial Institutions / Banks Can be formed by multi-disciplinary professionals CA Neeraj Menon Partner Shah Khandelwal Jain & Associates, Chartered Accountant

  8. FORMATION OF LLP CA Neeraj Menon Partner Shah Khandelwal Jain & Associates, Chartered Accountant

  9. Steps for formation of LLP… Digital Signature Certificate (DSC) for the designated partners Application in Form - 7 for DPIN (Designated Partner’s Identification Number) Verification of name availability on the website of LLP Application for Name Approval in Form -1 Payment of fees for formation of LLP which is based on the contribution of partners CA Neeraj Menon Partner Shah Khandelwal Jain & Associates, Chartered Accountant

  10. Steps for formation of LLP… Form – 2 to be submitted after it is digitally signed by designated partner along with the Advocate / Chartered Accountant / Company Secretary / Cost Accountant Completion of formation procedures within THREE months of date of name approval Filing of Agreement in Form – 3and Notice of appointment of partner in Form – 4 along with the Form – 2 or within 30 days from date of incorporation CA Neeraj Menon Partner Shah Khandelwal Jain & Associates, Chartered Accountant

  11. GENERAL POINTS IN LLP AGREEMENT CA Neeraj Menon Partner Shah Khandelwal Jain & Associates, Chartered Accountant

  12. General Points in LLP Agreement… Name & Address of LLP Nature of Business to be carried on Nature of partnership, whether AT WILL or for a specific period Form & manner of contribution between parties Name of designated partners Profit & Loss sharing ratio Powers and Duties of Designated Partners CA Neeraj Menon Partner Shah Khandelwal Jain & Associates, Chartered Accountant

  13. General Points in LLP Agreement… Rights of the partner Duties of the Partner Mutual Rights of the Partner Mutual Rights & Limitations of LLP Management & Administration of LLP Admission & Cessation of partners Amount of contribution to be introduced by the incoming partner and it’s impact on profit sharing ratio Remuneration Clause Goodwill Clause, if any CA Neeraj Menon Partner Shah Khandelwal Jain & Associates, Chartered Accountant

  14. General Points in LLP Agreement… Acts forbidden Requirements of disclosure of substantial interest of partners in transactions to be entered by the LLPn Clause CA Neeraj Menon Partner Shah Khandelwal Jain & Associates, Chartered Accountant

  15. THANK YOU CA Neeraj Menon Partner Shah Khandelwal Jain & Associates, Chartered Accountant

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