Conversion of LLP into Private Limited Company- Process & Documents

Updated on February 23, 2026 07:10:12 AM

There are companies in India that begin as Limited Liability Partnerships (LLPs) but later on plan to convert into a private limited company due to the benefits of establishing a private limited company. Read more about the process of conversion of LLP into Pvt Ltd Company in detail.

The provisions related to conversion of LLP into Private Limited company are mentioned under Section 366 of the Companies Act of 2013 and the Company (Authorised to Register) Rules of 2014, which states that such a conversion is possible as per the legal procedures.

LLP is a good option for a small or medium size business that has a turnover less than 40 lakhs annually. LLP companies that satisfy this condition do not have to go for financial audit every year. However, this is not the case with Private company registration . A private limited firm has to opt for financial account audits every year, regardless of the turnover and capital size.

In India, the Companies Act, 2013, read along with the Limited Liability Partnership Act of 2008, dictates the conversion process of an LLP to a Private Limited Company. Following are the conditions before such conversion can be affected:

• There must be at least two named partners in the LLP.
• The conversion to Pvt Ltd should be assigned to by all approved LLP partners.
• The LLP should have filed all such statutory documents, such as annual reports and financial statements as may be required prior to the date of conversion.
• The LLP should have no outstanding regulatory or statutory filings, disputes, or legal proceedings.
• The LLP should not have any outstanding obligations or liabilities that could inhibit the process of conversion.
• The LLP should have obtained all necessary approvals or permissions and licenses to carry on business activities.
• The name for the new Private Limited Company should not be identical to any existing company or LLP name.
• The conversion shall be done in due compliance with all the applicable laws and regulations as enshrined in the Companies Act of 2013.

Conversion from LLP to a Private Limited Company is a complex and time-consuming process; therefore, the entrepreneur may require professional services to ensure strict compliance with the legal provisions. If all the conditions are fulfilled and proper guidance is taken from professional services, entrepreneurs can convert their LLP into a Private Limited Company with ease and have the privilege of enjoying all the benefits of this form of organization.

Given below are the possible reasons for conversion of an LLP into a Private Limited Company:

1. An LLP converts into a Private Limited company mainly for growth and extension of the existing business.
2. An LLP company can attract only a few investment opportunities, so to extend the funding and investment opportunities like foreign funding and equity funding they convert to private limited company
3. LLP is converted into Private Limited to issue equity share capital.
4. LLP conversion into Private Limited also helps in avoiding capital tax gains.
5. The conversion also benefits in carrying forward unabsorbed losses and depreciation of the last year.
6. An LLP can be converted into Private limited with the same brand name, therefore brand name and goodwill can be used to grow further.

Conversion of an LLP to a Private Limited Company in India can offer multiple advantages to entrepreneurs at large, including:

• Better access to finance

  Private limited companies have more access to sources of funds, such as equity and loan financing. For this reason, converting to a Private Limited Company can help businesses raise funds for expansion or other business purposes.

• Recognized brands

  Private Limited Companies enjoy greater credibility and are perceived as more trustworthy compared to LLPs. A conversion to a Private Limited Company thus enhances brand awareness and market reputation of the business.

• Transferability of ownership

  Private limited companies allow the issuance of shares, permitting ownership to be transferred. Sometimes this is beneficial in cases when entrepreneurs want to sell a portion of the company or seek new investors.

• Limited Liability Protection

  Private limited companies, like LLPs, provide stockholders with limited liability protection. This means that the personal assets of shareholders are not jeopardized if the company suffers losses or incurs legal issues.

• Tax benefits

  One of the advantages of private limited companies includes reduced earnings tax rates, being able to carry over losses for future years, and being able to deduct company expenses against revenues. These benefits allow the business to reduce its overall tax liability.

• Greater scope for expansion

  As compared to LLPs, private limited companies have greater expansion possibility. They can have more than 200 shareholders, whereas in the case of LLPs, they are restricted to only 200 partners. Further, Private Limited Companies can operate in more than one state or even outside India, expanding entrepreneurs' commercial possibilities.

The list of documents required for conversion of LLP into Private Limited are as follows:

• Identity Proof
• Address Proof
• Passport size photographs of the applicant
• Copy of latest financial returns filed by the LLP.
• NOC from other partners and Registrar of Companies.

Documents required to file Form URC-1 are:

• Complete list of members with their personal details such as name, address, share holding.
• List of Directors with their personal details such as name, address, DIN.
• List of partners of the Limited Liability Partnership along with their personal details such as name, address etc.
• A Copy of limited Liability Partnership agreement and certificate of registration.
• Details related to the shareholders and value of shares that are held by all the shareholders in the company.
• NOC from all the creditors of LLP.
• Copy of newspaper in which the conversion related information is published.