Partnership to LLP Company Conversion

One needs to submit the following attachments along with the form:

1. Statement of consent of partners of the firm

2. Statement of Assets and Liabilities of the firm duly certified as true and correct by the Chartered Accountant in practice.

3. Copy of acknowledgement of recent income tax return

4. List of all the secured creditors along with their consent for the conversion

5. Approval from anybody/authority.

6. Any other document or information as requested by the authorities.

Once the mentioned documents are submitted to the Registrar after the verification, a certificate of Registration for LLP is issued.

The LLP must then inform the concerned Registrar of firms about converting a Partnership into an LLP within 15 days from the date of conversion through the prescribed forms.

PROCEDURE TO TRANSFER THE LICENSE AND REGISTRATION

• The Licenses, approvals, permits, or registrations will not be directly transferred into an LLP. If there are any properties registered under the Partnership firm before the conversion then the LLP must approach the concerned authorities and initiate the necessary procedure for the transfer of assets.

• Hence, before converting a Partnership firm into an LLP, the Partner must clarify all the aspects.

• After the conversion into an LLP, the Partnership gets dissolved, and the name of the Partnership firm is removed from the register of the Registrar of Firms. The Partnership firm is considered wholly transferred into an LLP, and the conversion does not affect any existing contracts, employments, agreement, etc.

• The Partners will now have Limited Liability Protection for all transactions conducted after the conversion. The Partners will continue to be personally accountable for all the business operated as a Partnership before conversion.

• Post conversion into an LLP, the newly formed LLP must intimate to Registrar of Firms about conversion of the firm into limited liability partnership (LLP) in prescribed Form 14 include a statement that it was converted from a Partnership into an LLP in all official correspondence for not less than 12 months from the date of conversion.

BENEFITS OF LLP OVER A PARTNERSHIP FIRM

Apart from the key differences, there are other features that make the LLP a better option than partnership firm:-

• Flexibility of Management: The partners are given a reasonable level of flexibility in conducting the operations and running the day to day affairs of the LLP. The LLP Agreement is not regulate by the Limited Liability Partnership Act, 2008, which means to say that the Act is comparatively flexible on how the agreement can be brought up.

• Perpetual Succession: Unlike in the partnership firms, the demise of the partner does not affect the existence of the LLP. The separate legal entity feature of the LLP allows it to carry on business.

• Investment Attraction: Foreign investors and venture capital funds consider LLPs as an investment opportunity as it has a corporate structure and is more organized in comparison to traditional partnerships.

• Associative LLPs: Professionals of various regulations can work together in an LLP, which are an exclusive attribute and an advantage in itself.