Start Add or Remove a Partner (LLP)

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REMOVE A PARTNER (LLP)

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How to Start Add or Remove a Partner (LLP)

Overview
WHY IS THE CHANGE OF PARTNERS REQUIRED?
Documents Required
WHAT ARE THE MINIMUM NUMBER OF PARTNERS?
PROCESS FOR ADDITION OR REMOVAL OF PARTNERS
FAQs

Overview

It is the partner who run a Limited Liability Partnership firm. From its management to the operation, the partners helps the LLP towards their goals and vision. New partners are added or the existing one leave. It mainly does not affect the status of the LLP, but it will definitely impacts the growth of the business as well as responsibilities of other partners. Only after the approval from the Ministry of Corporate Affairs the change in partners and their details can be affected. The consent of other partners must be obtained to add or remove a partner from LLP, It is followed by a change in the Agreement of LLP and application to MCA approve the changes. The application to MCA must be filed within 30 days of effective date of the change.

WHY IS THE CHANGE OF PARTNERS REQUIRED?

Expertise with additional Capital: A partner is either appointed for the need of the expertise or capital. With capital increase, the borrowing power of the firm increases with the opportunities of loan. Admission of a partner not only benefits the capital form but it also enhances the knowledge and skill. The knowledge diversity and goodwill base helps the business to grow far
Inability of the existing Partner: After a certain period of time the existing partner of the LLP may not be able to contribute his full time, due to retirement or various other reasons. Although the existence of LLP may not be affected by the exit of one partner, it must be dealt with intimation to MCA and also the appointment of new partner, if required.
Change in terms of Partnership: There is an agreement between the partners, the terms can be changed mutually at any time. There might be an impact on the willingness of one or other partner
Number of Designated Partners: There is a minimum requirement of 2 Designated partners all time to maintain every LLP. If there is reduction of partner below 2 due to resignation of a designated partner from LLP, the LLP must appoint a new designated Partner or the existing Partner position (status) must be changed by appointing a new designate Partner.

WHAT ARE THE MANDATORY DOCUMENTS REQUIRED FOR ADDITION OR REMOVAL OF DIRECTOR?

The documents that are required for addition or removal of partner are mentioned below:

LLP Agreement
Residence Proof
Photograph
PAN Card

WHAT ARE THE MINIMUM NUMBER OF PARTNERS?

DESIGNATED PARTNERS

Minimum 2 designated partners
all time

OTHER PARTNERS

LLP may run without other types of partner

Change Partners in 3 Easy Steps:

Answer quick questions
- Pick a Package that best fits your requirements
- Spare less than 10 minutes to fill in our Questionnaires
- Provide basic details & documents required for change
- Make payment through secured payment gateways
Experts are Here to help
- Assigned Relationship Manager
- Supplementary agreement for a change of partners
- Preparation of other necessary documents
- Preparation and filling of Application
- Updated MCA master data with modified details
Partner is Added or Removed
- All it takes is 7-10 working days

*Subject to Government processing time

WHAT IS THE PROCESS FOR ADDITION OR REMOVAL OF PARTNERS?

DAY 1:
- Consultancy for the requirement of change of partners
- Collection of basic information & documents
- Application for DSC(for partner to be appointed)
DAY 2-3:
- Drafting of necessary Resolutions and Documents
- Drafting of Supplementary Agreement
- Provide documents required provided after signature
DAY 4-7:
- Payment of stamp duty on the supplementary agreement
- Preparation of online application
- Filling of application for change

Why to Choose Legaltax?

FAQ's

In the original LLP Agreement the rights and liability of the existing partner will be prescribed. Also, the rights and restrictions can be specifically mentioned in the Agreement of Supplement with any amount of capital to be reimbursed and mode of payment

The partner must intimate about their intention to resign to the LLP and remaining partner, in order to resign from LLP. For the stated purpose, at least 30 days’ notice is required to be served by the resigning partner.

It is not mandatory to bring capital to the LLP. But, while addition one may contribute the amount agreed by and between all the Partners including the present, in any form whether tangible or intangible.

DIN is basically unique number assigned by MCA to individuals that allows one to become a Designated Partner or Director of the company of any LLP. DIN is allotted permanently and it can be used for subsequent appointment in another LLP or company..

As per the rate prescribed by the respective state, the stamp duty shall be paid according to the added capital in the LLP. Where there is the addition of capital while addition or removal, the Supplementary Agreement shall be executed by payment of Rs 100/- as stamp duty.

The most important difference between both types of Partners is the accountability. Here, the partner is himself responsible for the acts and omissions, the designated partners are mostly and additionally responsible towards compliance and operational matters of the LLP, including penal provisions.

Within 30 days the Supplementary Deed must be filed from effective date of change or from the execution date (whichever falls earlier). The delay in filing may cause you additional fee of Rs 100 per day till the date of filing.