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For Incorporation mostly people opt for Sole Proprietorship as there is low compliance required to initiate. After the growth it becomes mandatory to limit the liabilities and distribute it rather to burden it on a single person and best option is to convert it to private limited company. For conversion the promoter of business should agree to convert and mention it in MOA of the company.
If quality service is your need then rest assured you are at the right place. You just have to click to reach us. We, Law Samadhan, will take care of all the formalities that are to be done for Conversion.
The private limited company is considered separate legal entity because of which any asset or contracts are done in the name of company rather than any individual. This protects the shareholders or directors’ personal asset as they are only liable for the holding they have in the company.
In sole proprietorship the liability lies only on the owner of the company making it difficult to follow in case of debt but in private limited company the liability is distributed among the directors and members of the company reducing the burden.
The Transfer of ownership in Private Limited Company requires the consent of Shareholders which is not necessary in Proprietorship.
The private limited company is considered separate legal entity which protect its existence in case of death of any member the company remains unaffected unlike the proprietorship where the existence depend on the owner.
PAN CARD of Directors and Members
Passport If NRI or Foreign National
Aadhar/Driving License/Voter Id of Directors and Members (As identity Proof)
Bank Statement/Electricity or Gas Bill/Telephone or Mobile Bill (As Address Proof)
Passport Size Photograph of Directors and Members
MOA and AOA
Business Address Proof:
Latest Electricity Bill/Water Bill/Telephone or Mobile Bill
If Rented: Rent Agreement and NOC from the Property owner
If Owned: Copy of Property Papers
Note : *In case of NRI or Foreign National the documents of Directors and Shareholders must be Notarized or Apostilled.
Converting a Proprietorship to a Private Limited company involves obtaining the necessary licenses and approvals, registering the company with the Registrar of Companies, obtaining a Digital Signature Certificate and a Director Identification Number for the directors, and obtaining a PAN and TAN for the company.
To ensure a smooth conversion process, it is important to consult with a professional advisor, have all required documentation in order, and to ensure that all government requirements and regulations are met. Here, Law Samdhan team will be with you at every step of the conversion process.
During the conversion process, the assets and liabilities of the Proprietorship will become the assets and liabilities of the Private Limited Company.
It is not necessary to change the name of the Proprietorship during conversion, but it can be changed if desired and subject to the approval of the Registrar of Companies.
After conversion, the management structure changes from a single proprietor to a board of directors and shareholders. The board of directors is responsible for the overall management and direction of the company.
After conversion, the tax structure changes from a proprietorship to a corporate entity and the company will be subject to corporate tax laws and regulations.
Converting back from a Private Limited company to a Proprietorship is possible, but it is subject to certain conditions and the approval of the Registrar of Companies.
Conversion from Proprietorship to Pvt. Ltd. Company usually does not affect the employees, as they continue to work for the company under the same terms and conditions of employment.