Benefits of conversion of a Private Limited Company into LLP

Transfer of assets and liabilities on conversion of a Private Limited Company into a Limited Liability Partnership (LLP) does not attract any capital gain tax on such transfer. Other key benefits upon conversion are mentioned below:

Tax Implication

  • Upon conversion to LLP, no Dividend Distribution Tax (DDT) will be applicable unlike in case of Companies.
  • LLPs attract audit requirements subject to certain threshold limit, whereas companies are liable to mandatory statutory audit.

Number of shareholders/partners

Unlike private limited companies (shareholders limited to 50), an LLP can have unlimited number of partners.

Compliance requirements

There is no need of compliances related to meetings and maintenance of huge statutory records.

Benefit of transfer

  • All the assets and liabilities of the Company immediately before the conversion become the assets and liabilities of the LLP.
  • No stamp duty is required to be paid as all movable and immovable properties of the company automatically vest in the LLP without any execution of instrument of transfer.
  • As stated above, no Capital Gains tax shall be charged on transfer of property from Company to LLP.
  • The goodwill of the Company and its brand value is being continued to enjoy by the LLP.

Carry Forward and Set off Losses and Unabsorbed Depreciation

The accumulated loss and unabsorbed depreciation of Company is deemed to be loss/ depreciation of the successor LLP for the previous year in which conversion was effected and such loss can be carried for further eight years in the hands of the LLP. will assist you in all Business Incorporation & Maintenance issues including Creation of LLPs, Companies etc and also in post incorporation issues such as assistance in other registrations, ROC Compliances and others.

2 thoughts on “Benefits of conversion of a Private Limited Company into LLP”

  1. On conversion of a Pvt. Co. into LLP all properties are also transferred. Suppose Land is transferred. Now as per Govt. records the same is in the name of the company. What is the procedure to get the same changed to name of the LLP Firm. Will stamp duty be payable in such a case.

    1. Thanks for your query,

      There is a provision for exemption in this regard. We would certainly assist you in the same.

      Please provide us your contact details or call us at +919230033070 OR 03340060473
      or mail us at –

      Alok Patnia
      Founder and CEO at

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