Partners in an LLP may agree among then to change present profit ratio. It may to effect change in profit ratio alone or change contribution liability alone with profit ratio.
In both case LLP need to follow procedures in the LLP agreement. Usually, with the consent of partners, LLP can change profit ratio by an amendment to LLP agreement.Since, proft right in an LLP is a transferable commodity, proper assignment/transfer document need to be executed to effect transfer of profit ratio to another partner.
Based on transfer document, LLP need to make necessary changes in the LLP agreement and file amended document with Registrar of Companies
LLP Agreement Terms and ConditionsBefore effecting transfer among the partners (profit ratio), terms and conditions of LLP agreement regarding transfer of rights among the partners and procedures taken in to consideration.
Transfer DocumentIn the absence of such clause, partner can transfer with the consent of all other partners by executing transfer deed.
LLP Agreement amendmentAfter executing transfer deed, LLP agreement need to be amended to reflect the changes and a copy of the amended LLP agreement shall be filed with ROC
LLP Rights Transfer Deed
Subject to LLP agreement, partner transferring right to another partner shall execute transfer deed
LLP Agreement Alteration
After executing transfer deed, change LLP agreement to reflect the tarnsfer
The documents required for effecting transfer among the partner are present LLP agreement, executed transfer deed among the partners.
How it works