What is the Minimum Capital for LLP in India? A Complete Guide for 2025
What is the Minimum Capital for LLP in India? A Complete Guide for 2025
For entrepreneurs and professionals planning to start a business in India, a Limited Liability Partnership (LLP) is an increasingly popular choice. It offers the flexibility of a partnership with the legal advantages of a company. One of the first questions asked during registration is —
“What is the minimum capital required for an LLP in India?”
The answer might surprise you. In this blog, we’ll explain the minimum capital requirement for LLPs, the types of capital contributions, and how LLPs handle finances differently from companies.
📌 What is an LLP?
A Limited Liability Partnership (LLP) is a business structure introduced under the LLP Act, 2008, designed to combine the ease of traditional partnerships with the limited liability protection of private limited companies. LLPs are ideal for small businesses, startups, and professional firms like CA, CS, lawyers, architects, and consultants.
✅ What is the Minimum Capital for LLP?
There is no minimum capital requirement to register an LLP in India.
You can start an LLP with as little as ₹1 as capital contribution. This is a major advantage compared to private limited companies, which traditionally required a minimum paid-up capital of ₹1 lakh (now removed, but still a common practice).
This makes LLPs especially appealing to:
• Startups and bootstrapped founders
• Freelancers and solopreneurs
• Professionals forming service-based partnerships
💰 Types of Capital Contributions in LLP
An LLP allows for multiple forms of capital contributions, not just cash. Here’s what can be considered as capital:
1. 💵 Cash Contribution
The most common and straightforward form. Partners contribute money, which is recorded in the LLP’s books.
2. 🏢 Tangible Assets
Assets such as machinery, office equipment, vehicles, or real estate can be contributed as capital.
3. 💡 Intangible Assets
Patents, copyrights, trademarks, and even brand value or goodwill can be part of a partner’s capital contribution.
4. 🛠️ Services Rendered
Although not considered capital in the strict accounting sense, services with defined monetary value may be recorded in the LLP Agreement, provided they are assessable.
✅ Important: All contributions must be valued appropriately and mentioned clearly in the LLP Agreement.
📋 Capital Disclosure in LLP Agreement
During LLP registration, capital contribution details are declared in the LLP Agreement, which includes:
• The amount or value of each partner’s contribution
• The mode of contribution (cash, assets, etc.)
• Profit-sharing ratios and rights
This agreement is filed with the Registrar of Companies (RoC) through Form 3, and it acts as the legal foundation of the LLP.
🧾 Is Stamp Duty Applicable on LLP Capital?
Yes. The stamp duty on the LLP Agreement depends on the total amount of capital contributed and the state in which the LLP is registered. Each state in India has its stamp duty rates under its Stamp Act.
For example:
• In Delhi, stamp duty is ₹1,100 for up to ₹1 lakh capital.
• In Maharashtra, it may range from ₹1,000 to ₹5,000 depending on capital value.
✅ Always check your state’s stamp duty before drafting the agreement.
📈 Can Capital Be Increased Later?
Yes. LLPs can increase capital contribution at any time by amending the LLP Agreement and filing the changes with the RoC.
• Changes must be filed using Form 3
• Updated capital details must be reflected in the books of account
There is no upper limit on capital contribution in an LLP.
🏁 Final Thoughts
It’s as low as ₹1 — or even zero, depending on your agreement. This capital flexibility is one of the key reasons why LLPs are the go-to choice for professionals, small business owners, and startups.
With no minimum capital barrier, multiple modes of contribution, and low compliance costs, LLPs offer a business-friendly approach that allows you to start lean and grow smart.
