Entrepreneurs in India generally start their business as a sole proprietary concern. But eventually, as the business grows, they feel the need of separating the tax liability of the business and bank account of the business from that of the personal account and liability of the proprietor. Also, expansion of business as a sole proprietor is not very feasible. For expanding the business and to bring the business to better platform entrepreneurs prefer their sole proprietorship to be converted into a Private Limited Company.
Convert your Sole Proprietary concern to Private limited company in just Rs.___________/- in 20-25 days.
Liability of members, shareholders and directors are limited. There is no personal liability attached to a private limited company.
Private limited company is more reliable in comparison to a sole proprietary concern; investors find a private limited company more attractive if they have to invest a large amount.
Business needs to borrow money. In a Private Limited Company, only the amount invested will be lost and the personal property of directors won't be attached in case of liability arises. Limited Liabilities are given to shareholders.
Assets and liabilities of proprietary concern become asset and liabilities of Private Limited Company immediately before the succession of the propriety concern.
The proprietor of the proprietary concern shall not hold less than 50% voting power and shareholding in the private limited company for a period of 5 years from the date of conversion.
The succeeding sole proprietor does not receive any profit directly or indirectly from the new private limited company other than the allotment of shares of the company.