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Proprietorship To LLP

11450* Basic Package

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Overview

Transformation of Sole Proprietorship into an LLP

Growth is one of the prominent requirements for a business. Limited Liability Partnership, also known generally as LLP, is a prominent alternative for achieving the vision for an organization’s growth. LLP provides the benefits of both a sole proprietorship as well as a partnership firm. In the case of an LLP, businesses get more advantages when compared to traditional partnerships in terms of liability of members.

Therefore, a Limited Liability Partnership provides the additional advantage of limited liability for partners as compared to a sole proprietorship. LLP provides each partner with the liabilities due to misconduct or negligence of other partners. Furthermore, an LLP also provides better flexibility for organization of the internal structure as a partnership according to a mutual agreement. Therefore, transformation of a sole proprietorship into an LLP can be highly recommended for its growth.

A Single Legal Entity

One of the foremost benefits of transforming a sole proprietorship into an LLP is the automatic transfer of all assets and liabilities. The transfer of assets and liabilities of the sole proprietorship directly into an LLP turns the sole proprietorship into a single legal entity, distinct from the partners. No single partner can claim ownership of the LLP, while partners can enter into a contract and own assets in the name of the LLP. Partners of an LLP can also sue a third party in any dispute on behalf of the LLP.

No Need of Stamp Duty

The next important benefit of transforming a sole proprietorship into an LLP is the lack of any stamp duty. All the immovable and movable assets of a sole proprietorship are automatically vested in the LLP. Therefore, there is no need for executing any instrument of transfer, thereby taking away the requirement to pay stamp duty.

No Capital Gains Tax

It is also essential to notice that it is not possible to charge any Capital Gains tax on the transfer of property to the LLP from a sole proprietorship.

Ability to Carry Forward Losses

The total accumulated losses and the unabsorbed depreciation of the sole proprietorship are considered as the loss or depreciation of the new LLP for the previous year in which it is created. In addition, a succeeding LLP can help in carrying forward such losses further for eight years, thereby providing adequate support for set off.

Continued Brand Value

The brand value of the proprietorship would continue ahead with the LLP while staying intact. As a result, an LLP could gain the best of previous success story of the proprietorship and improved legal recognition.

Flexible Management

Partners have to agree on a specific internal structure for management of the LLP. Partners have to determine the duties and responsibilities for operating the LLP while offering flexibility to all partners for creating their own rules of management.

Limited Compliance Requirements

LLP business structures offer better advantages in terms of lower compliance requirements. In comparison to a private company, the restrictions on compliance requirements for the case of LLP, such as audit requirements, are limited. LLPs have to ensure statutory audits only after achieving a specific level of contribution to the LLP or turnover.

Naming the LLP

Another credible concern that pops up in converting to an LLP refers to development of a name for the LLP.

1) The first thing that you should focus on is a catchy name that is relevant to the brand identity of the LLP.

2) The name of the LLP must also indicate a subtle hint to its primary business activity.

3) The name of the LLP firm must have a “Limited Liability Partnership” or “LLP” as the suffix.

Transform to an LLP in Simple and Effective Steps

If you are troubled about the ideal approach to transform your sole proprietorship into an LLP, then you can rely on us. Here are three simple steps to establish an LLP with us.

1) Basic Formalities

A) Answer our questionnaire within 10 minutes.

B) Facilitate basic details and documents needed for registration of the LLP

C) Complete the payment with assurance of secure payment gateways.

2) Unhindered Expert Support

A) Dedicated Relationship Manager for the transformation process.

B) Support for procuring digital signatures.

C) Assistance with applications for name reservation and drafting documents such as LLP agreement.

D) Help with developing the Certificate of Incorporation.

E) Assistance for the PAN and TAN application processes.

It’s done!

Within almost 21 working days, depending on Government processing time, you have a registered LLP ready to run.

Document Required

The most important aspect in the process of transforming from a sole proprietorship to an LLP refers to the important documents needed for the conversion. Here is an outline of the crucial documents that you need for the transformation into an LLP.

  • Self-attested copies of PAN card of all partners. Foreign nationals are permitted to provide self-attested copies of passport.
  • Self-attested copies of Voted ID/Driving License/Aadhaar Card/ Passport of all partners
  • Recently taken passport-size photographs of all partners.
  • Evidence for the business address such as electricity bill, internet bill or telephone bill at the place of business.
  • No Objection Certification (NOC) furbished by the owner of the registered proprietorship
  • Rent Agreement of the registered office, if there is any.
  • It is also essential to notarize or apostille all the documents of NRI or foreign national partners.

Time Lines

  • (10 to 15 Days)
  • Purchase the Service
  • Upload / send the Documents
  • Discussion with expert
  • Filing of application with registrar authorities
  • Receipt of Registration Certificate
  • Confirmation to client

Service Covered

Pricing for what you want required service

Basic

11450*
  • Expert Consultation
  • 2 DPIN Application (if DPIN of directors are not available)
  • 2 DSC token
  • LLP Deed / Agreement
  • Capital / Contribution Rs. 1 Lakh
  • Incorporation Fee and Stamp Duty Fee
  • Registration with MSME
  • Conversion Process

Business

13950*
  • Expert Consultation
  • 2 DPIN Application (if DPIN of directors are not available)
  • 2 DSC token
  • LLP Deed / Agreement
  • Capital / Contribution Rs. 1 Lakh
  • Incorporation Fee and Stamp Duty Fee
  • Registration with GST
  • Registration with MSME
  • 3 months GST return filing upto 50 invoice per month
  • Conversion Process

Enterprise

17450*
  • Expert Consultation
  • 2 DPIN Application (if DPIN of directors are not available)
  • 2 DSC token
  • LLP Deed / Agreement
  • Capital / Contribution Rs. 1 Lakh
  • Incorporation Fee and Stamp Duty Fee
  • Registration with GST
  • Registration with MSME
  • ESI and PF Registration
  • 3 months GST return filing upto 50 invoice per month
  • 3 months account upto 75 entries per month
  • 10 MOA / AOA
  • Conversion Process
  • Note:
  • * This price is inclusive of all Govt filing fee and excluding GST amount.
  • Capital / Contribution more than Rs. 1 Lakh, additional fee required as per the specific state law.

FAQ's

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