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One Person Company Registration

Conversion of a private company to LLP

The LLP structure offers the advantages of both a partnership and a company. As a result, converting a company to an LLP provides the business with greater operational flexibility while maintaining the characteristics of being a separate legal entity and limited liability. In addition, the management and operations are directly in the hands of the LLP partner(s), unlike in a private company where they are with the director(s). An LLP is governed by the LLP Agreement executed by the partners and has fewer compliance requirements, making it easier to operate. It preserves the benefits of a partnership while providing security and credibility to a company. To convert a private limited company to an LLP, the necessary documents must be submitted through an online application for approval by the Ministry.


Benefits of converting Pvt. Ltd Company to LLP

Rewards and returns to partners

LLP partners receive various forms of returns, including remuneration, a share of the profits, and interest on their capital. Remuneration is paid to partners for their active participation, while the share of profits represents their portion of the profits generated by the business activities.

Independent liability

Individual partners in a business are protected from joint liability created by the wrongful business decisions or misconduct of other partners. This means that no partner is held liable for the unauthorized actions of their fellow partners.

Less Statutory Compliance

An LLP has fewer compliance requirements than a Private Limited Company. It is not necessary for an LLP to maintain statutory records and registers, and the requirement for a statutory audit is also relaxed.

Operational Flexibility

The LLP partners are directly involved in the daily operations and management of the business. In contrast to a company, an LLP is managed through a mutual agreement among its partners known as the LLP Agreement.


Documents required to convert Private limited company to LLP


NOC

Consent of all the directors and shareholders of the company for conversion in the given format

Clearance from tax authorities

NoC from the tax authorities is required to be obtained

Creditors approval

List of all the secured creditors along with their consent

Financial Statements

The financial statement of the previous year to be provided aling with ITR filed

Digital signature

DSC of all existing directors

Pvt.Ltd. company documents

PAN card, certificate of incorporation, GST registration or any other applicable documents/registrations.


Covert Private Limited company into LLP in 3 Easy Steps

1. Answer Quick Questions
  • Spare 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
  • Documents drafting including LLP Agreement
  • Certificate of Incorporation
  • Application for change in PAN & TAN
  • Payment of Stamp Duty on LLP Agreement
3. Conversion of private limited company to LLP is completed
  • All it takes is 20 – 25 working days*
*Subject to Government processing time

Process of conversion into LLP

Day 1 - 2
  • Consultancy and assistance for conversion
  • Collection of basic information & documents
Day 3 - 6
  • Application for Name Reservation for LLP
  • Drafting of necessary resolutions for company
Day 7 – 14
  • Drafting of incorporation documents
  • Filing LLP form 17 application for conversion into LLP
  • Online filing of LLP form 2
  • Government processing time to approve the application
Day 15 - 20
  • Application for change in PAN and TAN
  • Drafting of LLP Agreement
Day 20 - 25
  • Payment of Stamp Duty
  • Filing of LLP Agreement with MCA
  • Government processing time

Explore conversion of private company to LLP

Frequently Asked Questions


Following are the conditions for conversion: – All the members of the Company shall become the partners of the LLP on conversion. – No security interest in the assets of the company should be subsisting or in force on the date of conversion i.e. the assets are free of any encumbrance. – Up-to-date Income-tax return has been filed under the Income-tax Act, 1961. – Any clearance, approval or permission for conversion of the company into Limited Liability Partnership, if required from anybody/ authority, etc. has been obtained.

On conversion of the Company/partnership into LLP, all tangible (movable or immovable) and intangible property vested in the company, all assets, interests, rights, privileges, liabilities, obligations relating to the company/firm and the whole of the undertaking of the company shall be transferred to and vest in the Limited Liability Partnership without further assurance, act, or deed.

It has been provided in the Act that on conversion, any approval, permit or license issued to the Private Company under any other Act shall; subject to the provisions of such other Act under which such approval, permit or license was issued, be transferred in the name of converted entity viz. LLP. Barring some registrations like GST or which a new application needs to be filed.

LLPs are required to file an annual filing with the Registrar each year. However, if the LLP has a turnover of fewer than ₹40 Lakhs and/or has a capital contribution of fewer than ₹25 Lakhs, the financial statements needs no auditing.

A basic difference between the LLP and a company lays in the internal governance structure. The LLP has more flexibility and less compliance requirements compared to a Company.

Yes, the LLP Act 2008 allows Foreign Nationals including Foreign Companies & LLPs to incorporate LLP in India, provided at least one designated partner is resident of India. However, the LLP/Partners would have to comply with all the relevant Foreign Exchange Laws/ Rules/ Regulations/ Guidelines.

In case of conversion to LLP, the decision regarding capital gain, whether applicable or not, is subject to certain conditions. Any transfer of the capital asset or intangible asset or shares held in the company by a shareholder as a result of the conversion of the company into a Limited Liability Partnership would not be subject to Capital Gain. But if there is a change in shareholding i.e. change in the profit sharing ratio and benefit arises from the conversion, then the capital gain would be payable.

In most cases, the terms of the license become the deciding factor whether or not they can be transferred. Otherwise, fresh GST registration or FSSAI registration would have to be obtained by the promoters.

The application of PAN and TAN in the name of LLP shall be applied after the issuance of Certificate of Incorporation of LLP. The physical copy of the PAN will be received at the Registered Office only after being dispatched by the Income Tax Department.

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