Get your Proprietorship firm converted into a Private Company

A Sole Proprietorship may be easy to start, but it can hamper your growth. After all, it’s difficult to build a big business as a single person. If you’re looking to add partners to the business, but don’t want too much hassle, in the way of compliance work or cost, it is best to switch to a partnership.

Procedure for Conversion of Sole Proprietorship to Partnership

Drafting of Partnership Deed:
The conversion of a sole proprietorship into a partnership begins with the drafting of the partnership deed of your firm.

Declaration of Transfer:
The deed, in this case, would be different from a regular partnership deed, as it would also make several references to the proprietorship business and declare that it has been transferred to the partnership firm.

Main Features of a Partnership:
A partnership firm can have a maximum of 20 partners (unless you’re running a banking firm, in which case you have a maximum of 10 partners). Each partner has effective and equal control over the activities of the business and shares profits equally, unless there is any agreement contrary to this in the partnership agreement. No partners can, without the consensus of other partners transfer his interest to any other person (except an existing partner) without unanimous consent of all other partners. A partnership firm has a limited life span. Legally, the firm must be dissolved on retirement, lunacy, bankruptcy or death of any partner.