A proprietorship company or famously known as sole proprietorship company is a type of business that is owned by a single person. Here, there is no legal distinction between the owner of the business and the business. The owner is in direct control of all aspects related to the business, is accountable for its functioning and completely owns its profits or losses.
A private limited company or famously known as LTD is a privately held company. This implies that the business limits owner liability to its shares and limits number of shareholders to 50. It also restricts shareholders from trading shares publicly.
Advantages of Private Limited Company
Before you’re allowed to convert sole proprietorship into a private limited company, you must fit the following criteria
· A Private Limited Company can’t be headed alone. Thus, you’d need to appoint another director
· You will need at least two shareholders
· You should have the consent of everyone you once held debt to as a sole proprietorship.
· You must have up to date financial documents pertaining to your sole proprietorship.
The process to convert a Sole proprietorship to Private limited company is as follows:
· Complete your slump sale formalities as a sole proprietor.
· Appoint another director to head your upcoming private limited company.
· Appoint the DIN and DSC for the said director and yourself
· File the application to reserve the name of your private limited company using the RUN form.
· Draft Memorandum of Association to specify the object of your company and Articles of Association to specify the code of conduct your company promises to live by.
· File the application for company incorporation.
· Obtain the Certificate of Incorporation.
· Get the PAN and TAN of your newly formed private limited company.
· Make modifications to your bank details as per your new business entity.
We, at Registrationwala provide end to end solutions for conversion from sole proprietorship to private limited company. Our services include:
· DIN, DSC & Name Approval
· Submission of Form
· Reviewing the application and making changes if needed
· Obtaining Certificate of Incorporation
· Assisting you in obtaining PAN and TAN,
· Further assistance with maintaining your books
Registrationwala.com is a leading legal consultancy firm providing the comprehensive services relating to sole proprietorship to private limited company conversion.
So, take your first steps towards this conversion and reach out to us.