Conversion Of Pvt Ltd Company into LLP

Private Limited Company and Limited Liability Partnership are two different concepts and two different business forms. The main concern for business owners is which form of business benefits them the most. In recent time the Concept of LLP has emerged as it is a form of business entity, which allows individual partners to be free from the concept of joint liability of partners in a partnership firm And for that reason many business owners are turning towards the conversion of a Pvt Ltd co. to LLP. 

Prime reason why the concept of LLP has evolved is because of its simplicity in formation and easy maintenance. It helps owners also to limit their liabilities. This is the biggest advantage of an LLP over a traditional partnership firm. LLP has a blend of the benefits of a Company and a Partnership Firm namely. limited liability feature of a company and flexibility of a partnership firm. No partner is liable on account of unauthorized actions of other partners, thus individual partners are shielded from joint liability created by another partner’s misconduct. LLP form of organisation is usually preferred by Professionals, Micro and Small businesses that are family owned or closely held.

Conditions to fulfil for conversion of Private Limited Company (Pvt Ltd Co.) to LLP:

• Each member of the company requires agreeing with the choice of conversion.
• All members of the Private Limited Company will become the partners of the LLP.
• The most up-to-date copy of Income tax return must be filed with the Registrar of Companies.
• Not only the members, but also all the creditors of the private company must agree with the conversion.
• According to Companies Act, no prosecution should start any process to be followed

Effect of Conversion of Pvt Ltd Co. to LLP:

The following are some of the implications due to the conversion of a company into a LLP: 

• The private company is dissolved after conversion. 
• The name of the private limited company will be removed from the register of the ROC. 
• The conversion will not affect existing liabilities, obligations, agreements, contracts and continued employment. 

Company has to intimate all the authorities concerned about the conversion and make necessary changes in all the registrations and licenses.

Why Choose Tax Intelligence for Conversion of Pvt Ltd Company into LLP?

Tax Intelligence is an eminent business platform and a progressive concept, which helps end-to-end incorporation, compliance, advisory and management consultancy services to clients in India and abroad. Incorporating a Limited Liability Partnership is easy, seamless, cheapest and quickest with Tax Intelligence! Apart from an LLP, Tax Intelligence also helps entrepreneurs with Private Limited Company Registration, Public Limited Company Registration, Partnership Registration, HUF, One Person Company and Proprietorship Firm Registration easily. You may get in touch with us for free advisory on all the services.