An LLP is a separate legal entity formed through a legal process; there is an appropriate legal procedure to follow for its dissolution.
A limited liability partnership (LLP) can be wound up or have its name struck off the Register of LLP. For many LLPs, winding up can be a costly and time-consuming process that requires clearance from Tribunals and the assistance of Liquidators. As a result, an LLP that has been inactive since its inception or for more than a year may choose the simple route of striking-off. Following the Ministry's publication of the notice, the LLP will be considered struck-off. The LLP ceases to exist in the eyes of the law once it is struck off.
• To avoid compliance and filing obligations for LLPs that are no longer operating.
• The costs of keeping an LLP are higher than the costs of dissolving it. It is preferable to wind up a dormant LLP than to comply with the regulations.
• It is preferable to officially wind up dormant LLPs to avoid fines and penalties for late filing.
The LLP's name should not be confusingly similar to the name of any other LLP or trademark registration.
• LLPs registered in India are supposed to file yearly returns and statements of accounts for each financial year, regardless of annual income or profit and how they operate. LLPs who have not opened a bank account or started doing business must file the following filings each year to stay in LLP compliance and avoid penalties.
The majority of the members must file Form 2 saying that they have no outstanding obligations or will pay them within a defined length of time, but not more than a year from the date of passing the resolution to wind up the partnership.
A volunteer liquidator is appointed as the LLP liquidator with set remuneration when the resolution has received approval from most of the partners. Only 2/3rds of the creditors in the LLP's valuation will approve the appointment of a liquidator.
The LLP liquidator must prepare a report detailing how the LLP's affairs were wound up and how the LLP's property was disposed of after the LLP's affairs were properly wound up.
The LLP liquidator will issue a report as quickly as the LLP's affairs are completed. Discharging the LLPs' liabilities means that the LLPs' liabilities have been discharged, the assets have been liquidated, and the LLP liquidator will file a Form 9 report. This document details how the LLP was wound up and the final accounting close with a thorough explanation and the property that was sold. The creditors are sought for dissolution after the partners' approval.
• As identification, all partners must present their PAN Card copies.
• Address Proof of LLP Agreement, as well as any changes made therein
• Rent agreement and one utility bill (electricity bill, water bill, property tax bill, gas receipt, etc.) must be presented if the registered office location is rented. Also included will be a letter of authorization from the landlord.
• The LLP's financial statement, along with a copy of the latest INCOME TAX RETURN's acknowledgment.
• If there are any secured creditors, request an NOC for strike-off.
• Auditor/chartered accountant in practice certified the LLP's assets and liabilities to be genuine and correct.
LLP will no longer conduct business once the winding up procedure has begun, except to finish the liquidation and dispersal of its assets. The corporation will be dissolved and officially cease to exist after the process.
The name of a limited liability partnership (LLP) can be struck off by declaring it defunct for a one-year or more extended period. Because there is no involvement or obligation of the Liquidator or Tribunal, this is the simplest approach to close the LLP. A few conditions must be met in order to select this option.
If the Limited Liability Partnership is still in operation, the Partners must wait one year after the last transaction in the name of the LLP to choose this method of LLP dissolution. If the Partners do not intend to continue the LLP for a more extended period, they can choose for the winding-up procedure with the assistance of a Liquidator.
Yes, you must apply to surrender your PAN card.
No, it is not compulsory to appoint liquidator while we take decision related to winding up of LLP.
Yes. Consent of all the partners is required while striking off LLP