Online conversion of Proprietorship to Private limited Company

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Starting from Rs. 6499//- only (All inlusive)

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OVERVIEW

Many new business start with Proprietorship firm because of its less compliance and easy to start requirement. As business grows, it needs to register a private limited company due to its limited liability and other benefits.

Conversion of a proprietorship into a private limited company provides many benefits, like separate legal entity thereby reducing the risk of liability and the personal assets of directors will remain untouched except in case of fraud.

In case of Private limited company, there is a regulation of its operation which is governed by Companies act, 2013 and taxability of private limited company is also different in the Income tax act, 1961.

DIFFERENCE BETWEEN PROPRIETORSHIP AND PRIVATE LIMITED COMPANY

Proprietorship firm

It has limited scope of scalability as only one person is owner of the business who invest capital, manage and market the business.

Private Limited Company

It has capital invested minimum 2 person and maximum 200, in case of private limited company. Management, operation and market the business will be focused and as per the requirement of business.

Proprietorship firm has unlimited liability for any losses incurred. In simple terms, proprietor is personally liable to bear the loss of business.

The rules and regulations of a private limited company consider owner and the company a separate legal entity, thereby making liabilities of the owner limited.

Proprietorship firm has limited scope for fund raising especially in case of government startup scheme.

Private limited company is included in the definition of startup. Therefore, Startup registration will only be of those businesses which are registered as a Private limited company, wide scope of fund raising.

BENEFITS OF REGISTRATION OF PRIVATE LIMITED COMPANY

  • Key benefits of private limited company is Limited Liability, Attract Funding, Scalability, Easy exit plan and FDI investments.
  • Key benefit of Private Limited Company is limited liability which means protection of Personal assets of shareholders like: personal bank account, house, car etc. from company losses.
  • Business without Funding cannot survive or expand in Long Term. Private Limited Company have the ability to attract funding from Angel Investors, Banks or family or friends.
  • Private Limited Company is a Legal entity and govern by Companies Act 2013, it build customers confidence on products or services of the business.
  • Every business owner must have exit plan. Private limited company offers easy exit plan for all members of the company.
  • Every business owner must have exit plan. Private limited company offers easy exit plan for all members of the company.

HOW TO CONVERT FROM PROPRIETORSHIP TO PRIVATE LIMITED COMPANY

    First step is to register a private limited company.
    A takeover agreement or sale agreement needs to be entered into between the sole proprietor and company.
    The main object of Memorandum of Association (MOA) of company should include “The takeover of proprietorship firm”.
    The shareholding of proprietor in the company should not be less than 50% of the voting power, and the same must continue to be held for a period of 5 years.
    All the assets and liabilities of the sole proprietorship must be transferred to the company.

Proprietorship to Private Limited Company conversion Package

BASIC

Rs. 6499/- 

(All Inclusive)

  • 2 Digital Signature- Class: 2 for 2 Years.
  • 2 Director Identification Number.
  • Name approval.
  • Stamp Duty on 1 Lakh Capital.
  • COI (Certificate of Incorporation).
  • E-PAN.
  • E-TAN.
  • MOA & AOA.
  • Bank Account.
  • ESI & PF Registration.
  • Takeover/Sale agreement.

STANDARD

Rs. 9499/- 

(All Inclusive)

  • 2 Digital Signature- Class: 2 for 2 Years.
  • 2 Director Identification Number.
  • Name approval.
  • Stamp Duty on 1 Lakh Capital.
  • COI (Certificate of Incorporation).
  • E-PAN.
  • E-TAN.
  • MOA & AOA.
  • Bank Account.
  • ESI & PF Registration.
  • Takeover/Sale agreement.
  • GST Registration.
  • SSI/MSME Registration.
  • Commencement of Business: INC- 20A filing.

PREMIUM

Rs. 27,499/- 

(All Inclusive)

  • 2 Digital Signature- Class: 2 for 2 Years.
  • 2 Director Identification Number.
  • Name approval.
  • Stamp Duty on 1 Lakh Capital.
  • COI (Certificate of Incorporation).
  • E-PAN.
  • E-TAN.
  • MOA & AOA.
  • Bank Account.
  • ESI & PF Registration.
  • Takeover/Sale agreement.
  • GST Registration.
  • SSI/MSME Registration.
  • Commencement of Business: INC- 20A filing.
  • Auditor Appointment for 1 Year: ADT-1.
  • 1 Year GST Return.
  • 1 Year TDS Return.
  • 1st Year Income Tax Return filing turnover upto Rs. 50 Lakh.

DOCUMENTS REQUIRED FOR PVT LTD COMPANY REGISTRATION

DIRECTORS DOCUMENT

  • Photograph.
  • PAN card & Aadhar Card.
  • Proof of Identity: (Voter ID/Driving License/Passport).
  • Proof of Address: (Bank Statement/Electricity Bill/Mobile Bill).

COMPANY REGISTERED OFFICE DOCUMENTS

  • Rent Agreement or Lease Deed or NOC of Registered office address.
  • Electricity bill/Water Bill/Telephone Bill not older than 2 months.

CONVERSION DOCUMENTS

  • Detail of Assets and Liabilities hold by proprietorship business.
  • Detailed terms and conditions, if any for sale agreement or takeover agreement.

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