Add or Remove Partner in LLP
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ADD/REMOVE PARTNER IN LLP - AN OVERVIEW
A Limited Liability Partnership (LLP) is a flexible business structure that allows for easy changes in its partnership composition. Whether you are scaling up by adding new partners or restructuring by removing existing ones, the process is governed by the LLP Act, 2008 and the LLP Agreement.
Adding a partner usually involves bringing in new capital or expertise, while removing a partner may occur due to resignation, retirement, or death. In both cases, the Registrar of Companies (ROC) must be notified within 30 days to maintain the legal standing of the LLP.
The process requires a formal resolution, written consent/resignation, and most importantly, an amendment to the existing LLP Agreement through a Supplementary Agreement.
Key Considerations
- Minimum Partners: An LLP must have at least 2 partners at all times.
- Designated Partners: At least 2 partners must be 'Designated Partners', one of whom must be a resident of India.
- DPIN/DIN: Every incoming Designated Partner must have a valid DIN (Director Identification Number).
The Change Process
Step 1: Resolution
Hold a meeting and pass a resolution to approve the change in partners.
Step 2: Consent/Resignation
Obtain written consent from the new partner or resignation from the outgoing partner.
Step 3: Supplementary Agreement
Execute a supplementary LLP agreement on stamp paper.
Step 4: MCA Filing
File Form 4 and Form 3 with the MCA within 30 days.
Documents Required
Detailed Steps for Filing
Step 1: Obtain DSC
The incoming partner must have a Digital Signature Certificate for signing electronic forms.
Step 2: Apply for DIN
If the incoming partner is to be a Designated Partner and doesn’t have a DIN, an application must be made.
Step 3: Drafting Documents
Preparation of the Resolution, Consent Letter, and the Supplementary LLP Agreement.
Step 4: Execution of Agreement
The supplementary agreement must be signed by all partners and notarized on appropriate stamp paper.
Step 5: Filing Form 4
Notice of appointment/cessation is filed in Form 4 within 30 days.
Step 6: Filing Form 3
Information regarding the amended LLP agreement is filed in Form 3 within 30 days.
AI Compliance Check
Verify your readiness for Partner Change filing
Consequences of Delay
| Delay Period | Penalty | Other Impacts |
|---|---|---|
| Beyond 30 Days | ₹100 per day per form | Additional fees for supplementary agreement filing |
| Continuous Default | Compounding of offenses | Difficulty in opening bank accounts or applying for loans |
FAQs
What is the time limit for filing the change in partners with the ROC?
Is it mandatory to amend the LLP Agreement?
What are the documents required for adding a new partner?
Can a body corporate be a partner in an LLP?
What is the penalty for late filing of Form 3 and Form 4?
Why Taxcom Technologies?
Fast Processing
We handle MCA filings within 24-48 hours of document receipt.
Legal Drafting
Expert drafting of supplementary agreements to protect your interests.
Compliance Tracking
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