How to convert Private Limited Company into LLP?

Conversion of Pvt. Ltd Co into LLPTo ‘convert’ in the context of conversion of a private limited company into a LLP means  “a transfer of the property, assets, interests, rights, privileges, liabilities, obligations and the undertaking of the private company to the limited liability partnership in accordance with Third Schedule.”

Thus, conversion of a private limited company into a LLP would mean the transfer of the following of private company to the LLP in accordance with Third Schedule-

  • Property
  • Assets
  • Interests
  • Rights
  •  Privileges
  • Liabilities
  • Obligations, And
  • Undertaking

A Private Company to convert itself into Limited Liability Partnership (LLP) has to comply with certain legal & procedural requirements. The procedures for conversion are as follows –

Conditions required before conversion

  • Company to be registered under the Companies Act, 1956.
  • At least 2 designated partners, of whom 1 to be a resident in India.
  • Designated partners to obtain DIN if they don’t have one.
  • Digital signature certificate for at least one of the designated partners.
  • LLP (Limited Liability Partnership) name
  • LLP agreement
  • No security interest in its asset shall subsist or in force at the time of application.
  • The partners of the company or the designated partners in LLP can be same persons.

Procedures for conversion

  • Obtain DIN – All the designated partners to obtain DIN in case they are not having the same.
  • File form 18 – Application to be made in form 18 for conversion of Pvt. Ltd Co into LLP.
  • File form 1 – Form 1 for approving the name of LLP shall be filed and partners consent to convert it should also be attached.
  • File other forms – Also file Form 2, 3 & 4 along with a statement by all partners with registration number and date of registration of the firm.

i.   Form 2: Details of partners, registered office etc

ii.  Form 3: LLP agreement – this can be filed within 30 days from the date of registration

iii. Form 4: Consent of Partners – Consent of each partner to become a partner of Liability Partnership

  • ROC compliances –File with the concerned ROC(Registrar of Companies) the following documents –

a)      A statement by all its shareholders in such form and manner to be accompanied by such fees as the Central government may prescribe, containing the following particulars, namely-

                    i.     the name & registration no. of the Company

                   ii.     the date on which the company was incorporated

b)     Incorporation document & subscribers statement

  • Obtain Certificate of Registration – after receiving the above mentioned documents, ROC shall issue a certificate of registration in such manner & form stating that the LLP is registered to function.
  • Intimate the ROC – Up on registration of LLP, file an intimation to the Registrar of Companies in Form 14 stating the fact that the company is being converted into LLP

In this way a Private Ltd Co. can be converting into a LLP following the above rules, regulations and procedures.

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