Conversion of Partnership Firm to LLP

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Procedure for Conversion of Partnership to LLP

Complete the Conversion of Partnership Firm Application Form

Provide us Pertinent Documents

Make an Online Payment

Our Executive will manage the application process for Conversion of Partnership Firm

We will mail you a Certificate of Incorporation

Conversion of Partnership firm to LLP

Several partnership firms began converting to LLPs after the LLP Act was introduced in 2008. The benefits of conversion are obvious, including the possibility to accept an infinite number of partners, the creation of a new legal body, limited liability, and simplicity in the transfer of ownership. These benefits of LLP over partnerships have led to LLP’s rising popularity among small and medium-sized firms.

The Indian Partnership Act, 1932 requires the Partnership Firm that wants to become an LLP to register. Unregistered Partnership Firm can’t be transformed to LLP. The partners in an LLP that was formed by converting a partnership firm into an LLP must be the same. As a result, it is recommended that the Partnership Firm retire all of the Partners who do not wish to be a part of LLP, and that new partners be joined after LLP has been incorporated.

But, there is a formal procedure to follow in order to accomplish the aforementioned process, and a legal advisor from FinBiz may help you with this.

Characteristics of Partnership

  • A partnership or agreement between two or more people to split the gains and losses of a specific endeavor or business.
  • The profit sharing percentages of the partners are laid forth in a separate legal document called a partnership deed.
  • Limited liability status gives partners more freedom and flexibility.

Documents for Conversion of Partnership to LLP

  • A copy of each proposed partner's PAN card
  • Passports, election cards or voter identity cards, ration cards, driving licenses, and Aadhaar cards are all acceptable forms of address or identity proof for Indian citizens not more than 2 months old.
  • The Partner's Ownership Proof must include no more than 2 months old Electricity Bills, Telephone Bills, Gas Bills, Mobile Bills, or any other utility bills from the company location.
  • For Digital Signature Certificate we required two most recent passport photos.
  • All directors and members must provide the most recent bank statements no older than two months.
  • If a rented premises agreement or property papers are required, a copy of address proof is required.
  • The landlord NOC should be in given downloaded PDF format.
  • Any information pertaining to the partners' contributions.
  • Any information pertaining to the partnership firm's partnership deed or documents pertaining to the post-partnership incorporation process.
  • The proposed LLP's proposed name and authorized capital.

Minimum Requirements for Conversion to LLP

  • Timely filing of income tax returns.
  • All creditors must agree to the proposed conversion in LLP.
  • Two partners are required, of whom at least one must be an Indian resident.
  • DPIN & DSC for all Partners.

Process for Conversion of Partnership to LLP

1. Apply for DIN and DSC

The applicant must apply for a Director Identification Number (DIN) and a Digital Signature Certificate (DSC).

2. Verification of company name

The company name is checked and verified in this step to ensure that it complies with the Ministry of Corporate Affairs' (MCA) requirement.

3. Filling out the Form

Once the name of the business has been approved by the relevant authorities, the applicant will submit the application form for the certificate of incorporation through the relevant MCA portal, together with any necessary supporting papers.

4. Document Submission

After completing the aforementioned steps, the applicant must submit all necessary paperwork to the MCA.

5. Company Incorporation

The partnership would get its certificate of incorporation from the Registrar through this procedure, which would result in the transfer of all of its interests, assets, and obligations to the LLP.

6. Update Registrar of Firms

The last step requires the LLP's partners to inform the firms in a form that must be filed to the Registrar within 15 days of this process about the change in the partnership's status to LLP.

Benefits of Conversion of Partnership to LLP

Increased Investment

It would raise the amount of investment in the LLP and boost the company's reputation, attracting additional money from investors.

Permanent Succession

A partner's departure or death does not cause the partnership firm to dissolve.

Limited Liability

Limited liability would provide the firm's partners a degree of independence and keep the partners' liabilities distinct from the firm's.

Management Choice

When compared to a conventional partnership firm, an LLP has more flexibility and a faster decision-making process.

Foreign Direct Investment

The Indian government has loosened the rules governing FDI in an LLP.

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Frequently Asked Questions

1. What is the minimum number of Partners required to start a Limited Liability Partnership?

At least two members are required for LLP registration.

2. Who can become a partner in an LLP?

Any individual/organization can become the partner of LLP including foreigners/NRI’s.

3. Do I have to be available in-person to convert partnership to a LLP?

Our procedure is 100% online. You won’t need to be available at our office or show up at any other office for the conversion of partnership to a Limited Liability Partnership. A scanned copy of documents can be sent to us via mail, and we will handle the rest.

4. Once I pay for the incorporation, is there any other payment before I get the Incorporation Certificate of LLP?

There is absolutely no other payment. We will send you an all-inclusive invoice, with no hidden charges.

5. What is the time taken by LegalRaasta.com for conversion?

FinBiz.co.in can incorporate an LLP in 14-20 days. The time took also depends on relevant documents provided by the applicant and the speed of approvals from the government. To ensure speedy registration, please pick a unique name for the proposed LLP and make sure you have all the required documents before starting the registration process.

6. Can NRis/Foreign Nationals be a Designated Partner in LLP?

Yes, after acquiring DIN/DPIN an NRI or Foreign national can become a designated partner is LLP. However, at least one designated partner in the LLP must be a Resident of India.

7. What are the advantages of an LLP as opposed to @ Private Limited Company??

The main advantage is that in an LLP, there are fewer formalities after the business has been incorporated. For example, you need not file annual returns, etc. unless your income crosses a certain limit. An LLP is preferable if you are offering professional services, like a lawyer or architect. A Pvt. Ltd. Company is preferred if you want to launch a scalable enterprise.

7. What are the advantages of an LLP as opposed to @ Private Limited Company??

The main advantage is that in an LLP, there are fewer formalities after the business has been incorporated. For example, you need not file annual returns, etc. unless your income crosses a certain limit. An LLP is preferable if you are offering professional services, like a lawyer or architect. A Pvt. Ltd. Company is preferred if you want to launch a scalable enterprise.