Conversion of Business

The conversion of business refers to the process of changing the legal structure of an existing business to a different form, such as converting a sole proprietorship to a partnership, a partnership to a private limited company, or a limited liability partnership (LLP) to a private limited company. This process is crucial for businesses seeking to scale, limit liability, raise capital, or improve operational efficiency. Business conversion can help entrepreneurs take advantage of various tax benefits, improve credibility, and protect personal assets. The process ensures that the new structure aligns with the business’s long-term goals and requirements.

Documents Required

Proprietorship to LLP

PAN Card of Proprietor

Aadhaar Card of Proprietor

Certificate of Incorporation (LLP)

LLP Agreement

Bank Account Details (LLP)

Proof of Registered Office (Rent Agreement/Utility Bill)

Proprietorship to Private Limited Company

PAN Card of Proprietor

Aadhaar Card of Proprietor

Certificate of Incorporation (Private Limited Company)

MOA and AOA (for Company)

Bank Account Details (Company)

Proof of Registered Office (Rent Agreement/Utility Bill)

Partnership Firm to LLP

PAN Card and Aadhaar Card of Partners

Partnership Deed

Certificate of Incorporation (LLP)

LLP Agreement

Bank Account Details (LLP)

Proof of Registered Office (Rent Agreement/Utility Bill)

Process Timeline

Initial Consultation and Assessment

Understand the client’s current business structure and objectives for conversion (e.g., from sole proprietorship to a private limited company, partnership to LLP).

Evaluate Legal and Tax Implications

Analyze the legal, tax, and financial implications of the conversion, including liability, ownership, and taxation changes.

Documentation and Preparation

Gather all necessary documents such as financial statements, partnership deeds, or business contracts required for the conversion process.

Drafting of Required Agreements

Prepare legal agreements, such as new partnership deeds, articles of association, or memorandum of association, based on the new business structure.

Filing with Relevant Authorities

Submit required documents with regulatory bodies (e.g., Registrar of Companies for private limited company conversion, or LLP registration).

Transfer of Assets and Liabilities

Ensure proper transfer of assets, liabilities, intellectual property, and ongoing contracts to the new business entity.

Tax Registration and Compliance

Register for applicable tax IDs (e.g., GST, PAN, TAN) for the newly converted entity and ensure compliance with local tax regulations.

Update Business Licenses and Permits

Ensure that the business obtains or updates any necessary licenses or permits under the new business structure.

Communication with Stakeholders

Inform employees, clients, suppliers, and other stakeholders about the change in business structure.

Ongoing Compliance and Monitoring

Ensure the newly formed entity adheres to all regulatory requirements and continues to meet legal and financial obligations post-conversion.

Find the Perfect Fit for Your Budget

Choose from our range of flexible pricing options that cater to your specific needs.

₹7,999

Basic Plan

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Get Started

Consultation to assess the most suitable business structure for conversion

Preparation and filing of necessary documents for conversion

Filing of application with the relevant government authorities

Legal compliance checks and review of business operations for conversion

Email support for 1 month post-conversion

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₹14,999

Standard Plan

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Get Started

Consultation to determine the best conversion option based on business needs

Full documentation preparation, including drafting of new MoA, AoA, and registration documents

Filing of conversion application with the relevant authority

Assistance with obtaining a new PAN, TAN, and GST registrations

Tax implications review and basic tax planning for the converted entity

Email and phone support for 3 months post-conversion

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₹24,999

Pro Plan

A brief description goes here

Get Started

Comprehensive consultation to evaluate all aspects of the conversion, including legal, tax, and operational implications

Preparation of all necessary documentation for conversion

Filing of application for conversion with all relevant government bodies

Detailed tax and compliance planning post-conversion

Assistance with asset revaluation and transfer of liabilities

Customized business re-structuring advice

Assistance with obtaining new licenses and registrations required for the new structure

Full legal and compliance representation during the conversion process

Extended email, phone, and on-site support for 6 months post-conversion

Frequently Asked Questions

Find answers to commonly asked questions about our products and services.

What is the best time to convert my business structure?

Business conversion is ideal when your business has outgrown its initial structure and needs to raise capital, protect personal assets, or improve operational efficiency. A professional can help assess whether conversion is beneficial for you at this stage.

Can I convert my sole proprietorship into an LLP or Private Limited Company?

Yes, you can convert your sole proprietorship into either an LLP or a Private Limited Company. The process involves filing an application and meeting the necessary regulatory requirements.

Do I need to pay taxes when converting my business?

There could be tax implications during the conversion process, depending on the type of business and conversion. Professional advice is recommended to minimize any potential tax burden.

Will I lose my current business registration number during conversion?

When converting, your business registration number will change, especially if moving to a different business structure (like an LLP or Private Limited Company). You will need to apply for a new PAN, GST registration, and other relevant documents under the new entity.

How long does the business conversion process take?

The conversion process typically takes 2-3 weeks, depending on the complexity of the conversion and the approval time from the regulatory authorities.

Can I convert a partnership into a Private Limited Company?

Yes, a partnership can be converted into a Private Limited Company. The process involves filing specific forms and completing all necessary documentation for the company formation.

Do I need a professional to help with business conversion?

While it’s possible to handle the conversion independently, it is advisable to consult with a professional to ensure all legal and tax-related issues are correctly managed, minimizing the chances of errors.

What happens to the employees during business conversion?

During conversion, employees retain their positions, but certain benefits or legal rights may need to be updated to reflect the new business structure.