Convert Partnership to Private Limited Company

Expand your business reach with better funding , credibility and security by converting to private limited company.

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    Conversion of Partnership firm into Private limited co.

    A key advantage of registering a private limited company is that it establishes the company as a separate legal entity, a status not afforded to a partnership firm. In a partnership, personal assets of the partners can be seized, and they are held personally liable for all business debts and obligations. Consequently, as a business grows, converting a partnership into a private limited company can enhance credibility and limit liability for its members. Although statutory compliance requirements for private limited companies are more stringent than those for partnerships, this structure offers greater opportunities for growth and expansion.

    Benefits of conversion from partnership to a private limited company

    Limited Liability of Owners

    The liability of members or directors is restricted to the amount of capital they have contributed as agreed upon by the company’s members. Company losses or debts cannot be transferred to members, even during liquidation. Additionally, no member is held accountable for the negligence or misconduct of other members.

    separate legal entity

    A partnership does not constitute a separate legal entity. If a partner dies, retires, or exits the firm, the partnership dissolves, necessitating the formation of a new partnership. In contrast, a private limited company is a distinct legal entity, which also allows it to initiate legal actions against third parties.

    Separation of Management and Ownership

    The distinction between ownership and management enables each to concentrate on their respective roles. Shareholders delegate the responsibility of managing and running the company to directors, while retaining control through voting rights.

    Raising Capital

    Raising capital is more straightforward in a private limited company because it permits members to contribute without assuming personal liability, unlike a general partnership where all partners face unlimited personal responsibility. The organization also offers various methods for raising funds, including private equity, employee stock ownership plans (ESOPs), and other options.

    Documents required to convert partnership to private limited company

    PAN Card

    PAN Card of all partners Foreign nationals may provide passport

    Photograph

    Latest Passport size photograph of Shareholders and Directors

    Rent Agreement

    Rent Agreement of the registered office should be provided, if any

    Identity Proof

    Aadhar card, Voter ID/ Passport/ Driving License of Shareholders and Directors

    Business Address Proof

    Electricity Bill/ Telephone Bill of the registered office address

    Verification

    A Copy of Partnership deed and Certificate of Registration duty verified by at least two partners of the general partnership.

    Address Proof

    Telephone Bill /Electricity Bill/ Latest Bank Account Statement of Shareholders and Directors

    NOC from partners

    No Objection Certificate to be obtained from all the secured creditors of the applicant

    Copy of ITR

    A copy of latest income tax return filed by the Partnership firm

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    Formulation of LLP Name

    Unique Name

    Mainly it builds the LLP’s brand and preferably be a coined word

    Business Object

    Second part of the name should suggest a business activity of the LLP

    Constitution Type

    Name of the LLP must end with “LLP” or “Limited Liability Partnership” as suffix

    Convert into Partnership in 3 Easy Steps

    1. Answer Quick Questions
    • It takes less than 10 minutes to fill in our questionnaire
    • Provide basic details & documents required for proprietorship to partnership conversion
    • Make payment through secured payment gateways
    2. Experts are Here to Help
    • Assigned Relationship Manager
    • Drafting of Partnership Deed
    • Payment of Stamp Duty on Deed
    • Notary of Partnership Deed
    • Application for PAN and TAN
    3. Your Business is Established
    • All it takes is 12 working days*

    Process to convert proprietorship to LLP

    Day 1-2

    • Consultancy and assistance for conversion
    • Collection of basic information & documents

    Day 3– 5

    • Application for Digital Signature Certificate (DSC)
    • Application for DIN allotment of Designated Partners

    Day 6– 7

    • Checking Name availability
    • Application for Name Reservation

    Day 8 – 12

    • Drafting the incorporation document
    • Filing form for converting sole proprietorship to LLP
    • Certificate of Incorporation

    Day 13– 18

    • Application for PAN and TAN of LLP
    • Drafting of LLP Agreement, with conversion clause

    Day 19– 21

    • Payment of Stamp Duty
    • Filing of LLP Agreement with MCA
    • Government processing time

    Partnership to Private Limited Company