How To Convert A Sole Proprietorship To A Private Limited Company In Hyderabad & Bengaluru
In a real sense, a sole proprietorship company during its expansion plans, cannot get the benefits of a company as it grows and there comes a need for the company to transform itself into a private limited company which entitles it to gain the benefits of higher capital, limited liability, etc. The conversion into private limited companies also ensures the benefits bestowed to the members who became a part of private limited companies. Hence, before the conversion happens, the members need to have a tangible decision and consider all the factors involved and oversee the privileges which are intended
Procedure For Converting A Proprietorship To A Private Limited Company
According to the Companies Act of 2013 and the Income Tax Act of 1961 govern the conversion of a sole proprietorship firm to a private limited company. Conversion of a sole proprietorship to the private limited company can be accomplished by following the processes outlined below:
- The director identification number (DIN) and the digital signature certificate (DSC) must be obtained for all the directors
- Obtaining approval to name the corporation, which must be requested in Form-1
- Prepare the company’s MoA and AoA which outlines the company’s objectives and policies
- Make an application to the MCA for the establishment of the company
- The slump sale formalities must be completed by the proprietor
- Submit all the necessary documents
- You will be issued a certificate of incorporation.
The complete process of converting a sole proprietorship to a private limited company in Hyderabad & Bengaluru is believed to be dreadful. The conversion process involves registering a company as a whole, by providing the required documents to finalize the takeover, and ultimately end the proprietorship.