Regulatory Notice: Transferring business assets from a Proprietorship to a Company can attract massive Capital Gains Tax. Our CAs ensure your conversion is structured under Section 47(xiii) to make it 100% Tax-Neutral.
Corporate Restructuring

Transform Your Proprietorship
Into a Pvt Ltd Company.

Ready to scale, raise venture capital, or limit your personal liability? We securely transition your existing business into a Private Limited Company while preserving your brand and safeguarding against heavy capital gains taxes.

View Conversion Plans Understand Tax Rules

Why Convert to Pvt Ltd?

Limited Personal Liability

Unlike a proprietorship, your personal assets (home, savings) are protected if the business incurs heavy debts.

Fundraising & ESOPs

Venture Capitalists and Angel Investors strictly invest in Pvt Ltd companies. It also allows you to issue Employee Stock Options.

Separate Legal Entity

The business gains perpetual succession, meaning the company continues to exist even if the founder retires or passes away.

Crucial Rules for Tax-Neutral Conversion

Transferring a business is essentially selling it. To avoid paying massive capital gains tax on this "sale" to your own new company, you must strictly follow Section 47(xiii) of the Income Tax Act.

Asset Transfer

1. 100% Succession Required

You cannot pick and choose what to transfer. The business must be acquired as a "going concern".

  • All assets and liabilities of the sole proprietorship must become the assets and liabilities of the new company.
  • This is executed via a formal Takeover Agreement or Slump Sale Deed.
Shareholding Limit

2. 50% Minimum Voting Power

The proprietor must retain significant ownership in the newly formed Private Limited Company.

  • The sole proprietor must hold at least 50% of the total voting power in the new company.
  • This 50% shareholding must be maintained continuously for a period of 5 years from the date of succession to avoid retrospective taxation.
Consideration

3. Consideration in Shares Only

The proprietor cannot extract cash from the new company in exchange for the old business.

  • The sole proprietor receives shares in the new company as the only consideration for transferring the business.
  • No cash, bonds, or other benefits can be given to the proprietor in exchange for the transfer.
GST & Banking

4. Transition of Licenses & Accounts

Because the PAN changes (from Individual to Company), all associated licenses must be migrated.

  • A new GST Registration must be obtained. The old GSTIN must be cancelled citing "Change in Constitution", and ITC (Input Tax Credit) is transferred using Form ITC-02.
  • All bank accounts, PF/ESI registrations, and trademark assignments must be formally updated to the new entity name.
The Process

How we execute the conversion

Our expert CAs and Secretarial team manage the entire transition securely, keeping your operations running smoothly.

1

Incorporate Pvt Ltd

We incorporate the new Private Limited company, adding the proprietor as the majority shareholder, with an MOA explicitly allowing the takeover.

2

Takeover Agreement

Our legal experts draft the Slump Sale / Takeover Agreement, carefully structuring it under Section 47(xiii) to avoid capital gains tax.

3

Asset & Share Transfer

The assets and liabilities are transferred to the company, and the equivalent value of shares is allotted to the proprietor.

4

GST & License Migration

We assist in cancelling the old GST, applying for the new company GST, and filing ITC-02 to safely transfer your tax credits.

Conversion Plans

Select the required service tier. We'll schedule a call with a Corporate Restructuring Expert immediately to verify your requirements. No payment required upfront.

Standard Conversion

Ideal for small proprietorships with minimal assets, requiring basic incorporation and a standard takeover agreement.

₹14,999 professional fee
  • Dedicated Corporate Expert
  • Full Pvt Ltd Incorporation (2 Directors)
  • Standard Takeover Agreement Drafting
  • Initial MOA/AOA aligned for takeover
End-to-End Compliance

Premium (Tax-Neutral)

For operational businesses with significant assets, high turnover, and active GST credits that need safeguarding.

₹24,999 starting professional fee
  • Senior CA & Legal Team Assigned
  • Sec 47(xiii) Tax-Neutral Structuring
  • Custom Slump Sale Deed Drafting
  • GST Migration & ITC-02 Transfer Support

Important: The prices above are Professional Fees for the conversion process.

Government MCA incorporation fees, stamp duty on the takeover agreement (varies by state and asset value), and Registered Valuer fees (if required) are strictly extra and billed at actuals.

Required Documents

You will securely upload these documents directly to your encrypted client vault to initiate the conversion.

Proprietorship KYC

Existing GST Certificate, MSME, or Shop Act license.

Director Details

PAN, Aadhaar, Photo, and Bank Statement for minimum 2 directors.

Financials

Audited Balance Sheet & P&L of the proprietorship to determine asset value.

Registered Office

Electricity bill + NOC from the owner for the new company address.

Minimum 2 Directors Needed

Remember, a Private Limited Company requires a minimum of two directors and two shareholders. While you (the proprietor) will be one, you must find a trusted second person (like a spouse or family member) to fulfill the statutory minimums for incorporation.