Convert Proprietorship To Limited Liability Partnership

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Overview

“The main reasons to convert a proprietorship to a Limited Liability Partnership (LLP) are:

Limited liability protection for partners
Separation of ownership and management
Easier to raise capital
Improved credibility and reputation
Tax benefits
Easier transfer of ownership
Formal and established business structure.”

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Steps

01

"Select a name for the LLP that complies with the LLP Act and the Companies Act. "

02

Prepare LLP agreement

03

Register the LLP

04

Obtain Director Identification Number (DIN) and Digital Signature Certificate (DSC)

05

File the incorporation form (e-Form 2)

06

"Obtain name approval for the proposed LLP from the ROC. "

07

File LLP agreement (e-Form 3)

08

Obtain certificate of registration

Eligibility

Registration

The proprietorship must be a registered business and have a PAN number.

Operation

The proprietorship must have been in operation for at least one financial year. “

 

Partners

The proposed LLP must have at least two partners.

Requirements

The proposed LLP must comply with the requirements of the Limited Liability Partnership Act, 2008.

Agreement

All partners must agree to the conversion.

 

Certificate of Registration

  • "Upon the successful conversion of a proprietorship to a Limited Liability Partnership (LLP), the Registrar of Companies (ROC) issues a Certificate of Registration.

    This pivotal document serves as irrefutable proof of the LLP's legal existence and its legitimacy as a distinct legal entity. Its issuance signifies the completion of the conversion process, along with the approval of all submitted documentation and forms.

    The Certificate of Registration is indispensable for various essential business activities, including but not limited to opening bank accounts, securing necessary licenses, and commencing full-scale operations."