Register an LLP in India from the Philippines

How to Register an LLP in India from the Philippines

A Limited Liability Partnership (LLP) is a hybrid business structure recognised under India's LLP Act 2008. It combines the organisational flexibility of a partnership with the limited liability protection of a company. Since the liberalisation of FDI norms in November 2015, foreign nationals and companies, including those from the Philippines, can register and invest in LLPs in India, provided the LLP operates in a sector where 100% FDI is permitted under the automatic route with no performance-linked conditions.

For Philippine entrepreneurs and small-to-medium enterprises looking to enter the Indian market with a lighter compliance footprint, an LLP offers distinct advantages over a Private Limited Company. There is no statutory audit requirement below INR 40 lakh turnover or INR 25 lakh contribution, no mandatory board meetings, and simpler annual filings. However, LLPs cannot raise equity capital from the public or issue shares, making them less suitable for companies planning rapid expansion or seeking venture capital. See Private Limited vs LLP for a detailed comparison.

Bilateral trade between India and the Philippines runs into the billions of US dollars each year, with growing collaboration in IT services, pharmaceuticals, and agricultural processing. An LLP is particularly well-suited for Philippine professionals and consulting firms establishing a presence in India for service delivery, technology partnerships, or trade facilitation.

FDI Route and Regulatory Requirements

FDI in Indian LLPs is permitted under the automatic route since 2015, subject to the condition that the LLP operates in a sector where 100% FDI is allowed under the automatic route and there are no FDI-linked performance conditions (such as local sourcing requirements). Since the Philippines does not share a land border with India, Press Note 3 (2020) restrictions do not apply to Philippine investors.

Key Regulatory Conditions for FDI in LLPs

• Sector eligibility: The LLP must operate in a sector permitting 100% FDI under the automatic route without performance-linked conditions
• No government approval required: Philippine nationals and companies can invest without prior government or RBI approval
• Downstream investment: LLPs with FDI can make downstream investments in other Indian companies or LLPs, subject to the same sectoral conditions
• Conversion: An Indian company with FDI can convert into an LLP only if the company's activities are eligible for 100% FDI under the automatic route and there are no FDI-linked performance conditions

Partner Requirements

• Minimum partners: 2 (no maximum limit)
• Designated partners: At least 2 designated partners, of whom at least 1 must be an Indian resident (stayed in India for at least 120 days during the financial year)
• DPIN: All designated partners must obtain a Designated Partner Identification Number (DPIN)
• Contribution: No minimum contribution is prescribed under the LLP Act; however, the LLP agreement must specify each partner's contribution

For more on residency requirements, see Resident Director requirements. For comparison with other structures, see LLP vs Sole Proprietorship.

DTAA Benefits for Philippine Investors

The Double Taxation Avoidance Agreement between India and the Philippines, in force since 21 March 1994, ensures that income earned through the Indian LLP is not taxed twice. LLPs in India are taxed as partnerships at a flat rate of 30% (plus surcharge and cess, effective rate approximately 34.94%), and profit distributions to partners are exempt from further tax in the hands of the partners.

Key DTAA Provisions Relevant to LLPs

• Business profits (Article 7): The Indian LLP is taxed in India on its own profits; a Philippine partner's separate business profits are taxable in India only to the extent they are attributable to a permanent establishment in India
• Interest (Article 12): Withholding tax on interest paid from India to the Philippines is capped at 10% where the interest is received by a financial institution (including an insurance company), and 15% in all other cases
• Royalties (Article 13): Capped at 15%, but only where the royalty is payable by an Indian enterprise under a collaboration agreement approved by the Government of India; outside that condition the treaty sets no ceiling and Indian domestic rates apply
• Fees for technical services: The India-Philippines treaty has no fees-for-technical-services article. Technical service fees are therefore dealt with under Article 7 (business profits), Article 15 (independent personal services) or Article 23 (other income), so India can tax them only where the Philippine partner has a permanent establishment or fixed base in India
• Partner remuneration: Remuneration and interest on capital paid to partners as per the LLP agreement are deductible expenses for the LLP, subject to the limits prescribed under Section 40(b) of the Income Tax Act

The India-Philippines convention carries separate Air Transport and Shipping articles, so its numbering runs one article ahead of the usual OECD pattern: Dividends sit in Article 11, Interest in Article 12, Royalties in Article 13 and Capital Gains in Article 14.

Philippine partners should obtain a Tax Residency Certificate from the Philippine Bureau of Internal Revenue and file Form 10F in India to claim DTAA benefits. Refer to our DTAA Master Guide for step-by-step instructions.

Document Requirements and Authentication

The Philippines acceded to the Hague Apostille Convention on 12 September 2018, and the Convention entered into force for the Philippines on 14 May 2019. India did not object to that accession, so the Convention operates between the two countries. All Philippine documents required for LLP registration in India must be apostilled by the Department of Foreign Affairs (DFA) in Manila. This replaced the earlier requirement of embassy attestation and significantly simplified the document authentication process. See Apostille vs Embassy Attestation.

Documents Required from Philippine Partners

• Passport copies of all proposed partners (notarised and apostilled)
• Address proof of all partners (utility bill or bank statement, not older than 2 months, notarised and apostilled)
• Passport-size photographs of all partners
• If a Philippine company is a partner: Certificate of Incorporation/SEC Registration, Articles of Incorporation, and board resolution authorising the LLP investment (all apostilled)
• Proof of Philippine address for the foreign entity (apostilled)

Documents Prepared in India

• Digital Signature Certificate (DSC) for all designated partners
• Proof of registered office address (rent agreement + NOC from landlord + utility bill)
• LLP Agreement (must be filed within 30 days of incorporation)
• Subscriber's sheet signed by all partners

Step-by-Step Registration Process

Step 1: Obtain DSC and DPIN

All designated partners must obtain a Class-3 Digital Signature Certificate (DSC). Philippine nationals can apply by submitting notarised and apostilled passport copies. The Designated Partner Identification Number (DPIN) can be obtained through the MCA portal or as part of the FiLLiP form. Timeline: 3-5 days.

Step 2: Name Reservation (RUN-LLP Form)

Reserve the LLP name through the RUN-LLP form on the MCA portal. Up to 2 name options can be submitted per application. The name must be unique and not similar to any existing company, LLP, or trademark. The reserved name is valid for 90 days. Timeline: 1-3 days.

Step 3: File FiLLiP Form for Incorporation

Complete the FiLLiP (Form for Incorporation of Limited Liability Partnership) with details of all partners, designated partners, registered office, and capital contribution. Attach the subscriber's sheet signed by all partners. The Registrar reviews the form and, upon approval, issues the Certificate of Incorporation. Timeline: 5-10 days.

Step 4: File LLP Agreement (Form 3)

The LLP Agreement must be filed with the ROC within 30 days of incorporation using Form 3. This agreement governs the rights and duties of partners, profit-sharing ratios, management responsibilities, and dispute resolution mechanisms. It must be executed on appropriate stamp paper as per the state's stamp duty rates. Timeline: 1-2 days (filing).

Step 5: Obtain PAN, TAN, and Open Bank Account

Apply for a Permanent Account Number (PAN) and Tax Deduction Account Number (TAN). PAN is typically allotted along with the Certificate of Incorporation. Open a current account with an Indian bank for business operations and receipt of foreign contribution.

Step 6: FEMA Reporting

Report the foreign investment in the LLP through the AD bank. LLPs do not file FC-GPR (which applies to share allotment in companies); capital contribution received from a foreign partner is reported to the RBI in Form LLP-I, filed through the AD bank on the FIRMS portal within 30 days of receiving the funds. Ensure compliance with FEMA notification on foreign investment. See our FEMA/RBI Compliance guide.

Timeline and Costs

The end-to-end timeline for registering an LLP in India from the Philippines is approximately 4-8 weeks:

Cost Breakdown

• Government fees (MCA): INR 500-5,000 (based on contribution amount)
• Stamp duty on LLP Agreement: INR 1,000-10,000 (varies by state)
• DSC fees: INR 1,500-3,000 per partner
• Professional fees (CS/CA): INR 15,000-60,000
• Apostille charges in the Philippines: PHP 100-200 per document (DFA fees)
• Total estimated cost: INR 25,000-80,000 plus apostille and notarisation costs

Post-Registration Compliance

LLPs in India have a lighter compliance burden compared to Private Limited Companies:

• Annual return (Form 11): Filed within 60 days of the close of the financial year (by 30 May)
• Statement of accounts and solvency (Form 8): Filed within 30 days of the end of 6 months from the close of the financial year (by 30 October)
• Income tax return: Filed annually by 31 July, or by 31 October where the LLP's accounts must be audited
• Tax audit: Mandatory if turnover exceeds INR 1 crore (or INR 10 crore if cash transactions are less than 5%)
• Statutory audit: Required only if turnover exceeds INR 40 lakh or contribution exceeds INR 25 lakh
• GST compliance: Monthly or quarterly GST returns if the LLP is GST-registered
• Transfer pricing: Applicable if transactions with Philippine partners or associated enterprises exceed prescribed thresholds

Beacon Filing provides comprehensive annual compliance and tax filing services for LLPs with foreign investment.

Common Challenges for Philippine Companies

Sector Restriction for FDI in LLPs

FDI in LLPs is permitted only in sectors where 100% FDI is allowed under the automatic route with no performance-linked conditions. This means sectors like single-brand retail (which requires 30% local sourcing above 51% FDI), defence, and telecom are not accessible through the LLP structure. Philippine companies targeting these sectors must use a Private Limited Company instead.

Finding an Indian Resident Designated Partner

At least one designated partner must be an Indian resident who has stayed in India for a minimum of 120 days during the financial year. Philippine entrepreneurs establishing their first business in India may need to appoint a trusted Indian professional as a designated partner until one of the Philippine partners establishes residency in India.

Inability to Raise Equity Capital

LLPs cannot issue shares or raise equity capital from external investors. Growth capital must come from partner contributions or debt. Philippine companies planning to raise venture capital, private equity, or pursue a future IPO should consider incorporating a Private Limited Company or Wholly Owned Subsidiary instead.

Conversion Complexity

If the business outgrows the LLP structure, converting to a Private Limited Company requires following the Companies Act provisions, obtaining fresh incorporation, transferring assets, and potentially triggering tax implications. Plan the entity structure carefully at the outset to avoid costly restructuring. See LLP to Private Limited Conversion.

Limited Brand Recognition in India

Indian banks, landlords, and large corporate clients may be less familiar with LLPs compared to Private Limited Companies. Philippine companies that need to establish strong credibility quickly, negotiate large contracts, or engage with government entities may find a Private Limited Company more suitable for the Indian market.

Frequently Asked Questions

Can a Philippine company be a partner in an Indian LLP?

Yes. A Philippine company can be a partner in an Indian LLP, provided the LLP operates in a sector where 100% FDI is allowed under the automatic route without performance-linked conditions. The Philippine company must appoint a natural person as its nominee to act as the designated partner.

Is there a minimum capital requirement for an LLP in India?

No. There is no minimum contribution requirement under the LLP Act 2008. The contribution of each partner (whether in cash, tangible or intangible property, or other benefit) is determined by the LLP agreement. However, the contribution should be reasonable for the intended business operations.

How is an LLP taxed in India?

An LLP is taxed at a flat rate of 30% on its total income, plus applicable surcharge (12% if income exceeds INR 1 crore) and 4% health and education cess, giving an effective rate of approximately 34.94%. Profit distributed to partners is exempt from further tax in the hands of the partners.

Does an LLP need to file FC-GPR?

No. FC-GPR applies only to companies issuing shares to foreign investors. Foreign capital contribution to an LLP is reported instead in Form LLP-I, filed through the AD bank on the RBI's FIRMS portal within 30 days of receiving the funds. Partners must ensure timely reporting of all foreign investment to avoid penalties.

Can an LLP be converted to a Private Limited Company?

Yes. An LLP can be converted to a Private Limited Company under Section 366 of the Companies Act 2013. The process involves filing Form URC-1 with the ROC, obtaining necessary approvals, and re-registering the entity. The conversion is treated as a transfer of assets and may have tax implications.

What happens if the LLP Agreement is not filed within 30 days?

Failure to file the LLP Agreement within 30 days of incorporation attracts a penalty of INR 100 per day of delay. Additionally, the default LLP agreement provisions (as per Schedule I of the LLP Act) will apply, which may not reflect the partners' intended arrangements.

Can a Philippine individual register an LLP in India without visiting India?

The registration process can be completed remotely using apostilled documents and a DSC obtained from a licensed Indian Certifying Authority. However, opening a bank account may require in-person or video KYC verification. The LLP Agreement must be executed on stamp paper, which can be arranged through a Power of Attorney holder in India.