LLP vs Pvt Ltd · break-even
The actual cost gap — at your revenue
Drag the slider to your annual revenue. The amber band is the annual saving from choosing LLP over Pvt Ltd. The kink at ₹40L is where LLP's mandatory audit threshold kicks in.
LLP annual cost
₹25K
filing + ROC (no audit)
Pvt Ltd annual cost
₹80K
mandatory audit always
LLP saves you
₹55K
per year
Break-even on restructuring
LLP saves ₹55K/yr. Restructuring payback: 2.2 yrs. Start as LLP and convert only when a term sheet is on the table.
Payback
2.2 yrs
Restructuring estimate: ₹80K–₹1.5L to dissolve an LLP and incorporate a Pvt Ltd via SPICe+. Compliance costs are indicative professional fee ranges — actuals vary by city and complexity. LLP audit exemption requires turnover <₹40L AND capital contribution <₹25L (both conditions).
Common questions
Compliance cost, statute-cited.
Why does the LLP cost curve kink at ₹40 lakh turnover?+
An LLP must get its accounts audited only when its turnover exceeds ₹40 lakh in a financial year or its capital contribution exceeds ₹25 lakh — Rule 24 of the LLP Rules 2009 under the LLP Act 2008. Below both thresholds no audit is mandatory, which is why the tool shows a jump in cost at the ₹40 lakh mark.
Is audit always mandatory for a Pvt Ltd?+
Practically yes — every private limited company must appoint a statutory auditor and get its financial statements audited, regardless of size, under s.139 of the Companies Act 2013, with the audit report attached to the AOC-4 filing under s.137. There is no turnover exemption, so a Pvt Ltd carries audit and filing cost even at low revenue.
What is the tax audit position for LLPs?+
Separate from the LLP Act audit, a tax audit under s.44AB of the Income-tax Act 1961 applies where turnover crosses ₹1 crore for business (₹10 crore with 95%+ digital receipts) or ₹50 lakh for a profession — with the Form 3CD report filed by 30 September. The ₹40 lakh threshold in this tool is the LLP Act audit test, not the s.44AB tax audit test.
How is the restructuring payback calculated?+
The tool uses a ~₹1.2 lakh estimate to dissolve an LLP and incorporate a fresh Pvt Ltd via SPICe+ (professional fees + government fees) and divides that by the annual cost saving from choosing LLP, then compounds at 10% over 5 years to show the corpus edge. The cost figures are indicative professional-fee ranges — actuals vary by city and complexity.
Should I start as an LLP and convert to Pvt Ltd later?+
There is no statutory LLP-to-Pvt Ltd conversion in Indian law — you dissolve the LLP and incorporate a fresh Pvt Ltd, transferring every contract, licence, bank account, and GST registration manually. This tool's break-even view helps you decide: if you expect to raise VC within 2 years, starting as a Pvt Ltd directly usually wins despite the higher ongoing cost.