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One Person Company Registration

Conversion of Partnership firm into Private limited co.

Registering a private limited company offers a significant advantage of conferring a separate legal entity status, which a partnership firm lacks. In a partnership, personal assets of partners are at risk, and they become personally accountable for every debt or liability incurred by the business. Consequently, partners seeking to enhance their business's credibility and limit their liability prefer to convert their partnership into a private limited company, especially with business expansion. Although the statutory compliance requirements for a private limited company are higher than those for a partnership, it offers greater opportunities for the company to thrive and extend its reach.


Benefits of conversion from partnership to a private limited company

Limited Liability of Owners

A company's members or directors are accountable only for the amount of capital they have contributed. They are not liable for the company's debts or losses during liquidation. Moreover, each member is individually responsible for their conduct, and they are not held responsible for the misbehavior or carelessness of other members.

Separation of Management and Ownership

Separate ownership and management enable both parties to concentrate on their respective roles. Shareholders delegate the responsibility of managing and operating the company to the directors without losing their control through voting rights.

separate legal entity

A partnership does not have its own legal entity. In the event of a partner's death, retirement, or departure, the partnership dissolves, and a new one must be created. However, a private limited company operates differently. As a separate legal entity, it can sue third parties and continues to exist even if a director or shareholder departs.

Raising Capital

Raising capital is comparatively easier in a private limited company as it permits members to contribute without assuming personal liability, unlike a general partnership where all partners have unlimited liability. Moreover, the private limited company offers various methods to raise funds such as private equity, ESOP, and more.


Documents required to convert partnership to private limited company


PAN Card

PAN Card of shareholders and Directors. Foreign nationals may provide a passport.

Identity Proof

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

Address Proof

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

Photograph

Latest Passport size photograph of Shareholders and Directors

Business Address Proof

Electricity Bill/ Telephone Bill of the registered office address

NOC from partners

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

Rent Agreement

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

Verification

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

Copy of ITR

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


Convert into company 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 registration
  • Make payment through secured payment gateways
2. Experts are Here to Help
  • Assigned Relationship Manager
  • Procurement of Digital Signatures (DSC)
  • Application for Name Reservation under “RUN”
  • Documents drafting including MOA and AOA
  • Application of conversion into Private Company
  • Certificate of Incorporation
  • Application for PAN and TAN
3. Your firm is converted into company
  • All it takes is 12 -15 working days*
*Subject to Government processing time

Process of conversion of partnership firm into private limited co

1 -2 Days
  • Application for Digital Signature Certificate
3-5 Days
  • Checking Name availability
  • Application for Name Reservation under “RUN“
  • Reservation of Name
6-8 Days
  • Drafting of MoA, AoA & other required documents
  • Stamp Duty Payment
  • Notarization of required documents
8-10 Days
  • Filing out company registration application
  • DIN Allotment Application
  • Application for PAN and TAN of company
11-15 Days
  • Government processing time

Explore partnership to private limited company conversion

Frequently Asked Questions


For Private Company registration, the following requirements must be fulfilled: 1. Minimum 2 directors shall be appointed, out of which one must be a resident of India. 2. Minimum 2 shareholders are required for this registration. Here, an individual may become shareholder and director at the same time. 3. A place of business in India must be provided as a registered office address

While registration, minimum authorized capital of ₹1 Lakh should be provided. The requirement of minimum paid-up capital is eliminated as a part of Government’s initiative to simplify business registration in India. However, each shareholder must subscribe at least 1 share for the registration and amount sufficient to run a business should be introduced.

Any person above the age of 18 years can become a director in the company after procuring Director Identification Number (DIN). As there are no criteria provided in terms of citizenship or residency, a foreign national can also become a director. The application of DIN Allotment is now merged with the application for the formation of a company subject to a limit of maximum 3 DIN.

A private limited company must hold a Board Meeting at least once in every 3 months. In addition to the Board Meetings, an Annual General Meeting must be held by the Private Limited Company at least once every year.

100% Foreign Direct Investment is allowed in India in many of the industries under the Automatic Route. Under the Automatic Route, only a post-investment filing is necessary with the RBI indicating the nature of investment made. There are a few industries that require prior approval from the RBI, and in such cases, approval must first be obtained from RBI prior to the investment.

There is no concept of a common seal in partnership. But a private limited company has a common seal which denotes the signature of the company and every company shall have its own common seal.

No Capital Gains tax or stamp duty shall be charged on transfer of property from Partnership firm to a Private Limited Company.

The accumulated loss and unabsorbed depreciation of Partnership firm are deemed to be loss/ depreciation of the successor company for the previous year in which conversion was effected. Thus, such a loss can be carried out for a further eight years in the hands of the successor company.

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