The main purpose of converting an LLP to a Pvt Ltd is to improve the credibility, recognition, and flexibility of the business, and to secure investments and loans more easily.
The LLP must have a minimum of two partners to convert into a Private Limited Company. The LLP must first seek approval from all partners to initiate the conversion process. Furthermore, it should have a minimum of two shareholders and two directors, with one director being a resident of India, as required under the Companies Act, 2013.
The LLP should not have any outstanding unsecured debts or must obtain written consent from creditors. The financial records of the LLP should also be in compliance with statutory audit requirements to avoid any complications during the conversion process.
The proposed name for the Private Limited Company must be approved by the Registrar of Companies (RoC). A name reservation is mandatory before proceeding with the conversion.
The LLP must submit its latest audited financial statements. These accounts should not be older than six days from the date of submission to the Registrar of Companies.
