Can you convert? The five gates
| Gate | The test |
|---|---|
| No security interest | No charge or security interest may subsist on the company's assets at the time of the application. Satisfy and close any charge on the MCA record first |
| All shareholders, no one else | The partners of the LLP must comprise all the shareholders of the company and nobody else. You cannot add a new partner in the same step |
| Consents | Every shareholder consents in the statement filed with the application, and the creditors' consent is obtained |
| Filings current | The latest annual filings with the ROC and the latest income-tax return should be filed before the application |
| No pending prosecution or default | A conversion application with open non-compliance invites queries. Fix the backlog first |
Only a private company or an unlisted public company can take this route. A company whose shareholders will not all become partners, or whose assets carry a bank charge, is not eligible until that changes.
Forms, fees and sequence
| Step | Form | Government fee |
|---|---|---|
| Board approval and shareholders' consent | None | None |
| Name reservation for the LLP | RUN-LLP | ₹200 per application |
| Conversion application with the incorporation form | Form 18 filed with FiLLiP | By contribution: ₹500 up to ₹1 lakh, ₹2,000 above ₹1 lakh to ₹5 lakh, ₹4,000 above ₹5 lakh to ₹10 lakh, ₹5,000 above ₹10 lakh |
| LLP agreement, filed after registration | Form 3, within 30 days | ₹50, ₹100, ₹150 or ₹200 on the same contribution slabs |
| Intimation to the ROC that the company has converted | Form 14, within 15 days of registration | Charged separately on the company side |
| Stamp duty on the LLP agreement | Not an MCA fee | Set by the stamp law of the state, generally scaled to contribution. We confirm the state rate before execution and do not publish a figure |
What it costs
| Item | Amount |
|---|---|
| Professional fee | from ₹4,999 |
| RUN-LLP | ₹200 |
| Form 18 with FiLLiP | ₹500 to ₹5,000 by contribution |
| Form 3 | ₹50 to ₹200 by contribution |
| Stamp duty on the LLP agreement | State-specific, at actuals |
Professional fees exclude GST at 18%. Government fees, where they apply, are paid at actuals to the department and are shown separately. Fees verified on 22 September 2026.
The tax test that decides most conversions
Conversion transfers every asset of the company, so it is a transfer for capital-gains purposes unless the law says otherwise. It says otherwise only if every condition is met.
For a conversion in FY 2025-26 the provision is section 47(xiiib) of the Income-tax Act, 1961. For Tax Year 2026-27 onwards, under the Income-tax Act, 2025, it is section 70(1)(ze). The conditions read the same in both:
- all the assets and liabilities of the company immediately before conversion become those of the LLP;
- all shareholders of the company become partners of the LLP, and their capital contribution and profit-sharing ratio are in the same proportion as their shareholding;
- shareholders receive no consideration or benefit other than a share of profit and a capital contribution in the LLP;
- the shareholders' aggregate profit-sharing ratio stays at least 50 per cent for five years from conversion;
- total sales, turnover or gross receipts did not exceed ₹60 lakh in any of the three tax years preceding conversion;
- the total value of assets did not exceed ₹5 crore in any of the three tax years preceding conversion;
- no amount is paid out of the accumulated profit of the company to any partner for three years from conversion.
What that means in practice. Most companies with real revenue fail the ₹60 lakh turnover test or the ₹5 crore asset test, and for them conversion is a taxable transfer of the undertaking. If a condition is met at conversion but broken later, for example by paying out accumulated profit within three years or by letting the profit-sharing ratio fall below 50 per cent inside five years, the exemption is withdrawn and the gain becomes taxable in the year of the breach. We run the three-year numbers before we file anything. Ask us to quantify the exposure, and see tax planning and valuation under Rule 11UA where a valuation is needed.
What conversion gives you, and what it takes away
Continues automatically. On registration, every tangible and intangible asset, interest, right, privilege, liability and obligation of the company vests in the LLP, and the company is deemed dissolved and removed from the records of the Registrar of Companies. Pending proceedings continue, existing agreements and employment contracts continue, and licences and approvals continue as if the LLP were the original party. For twelve months after registration, official correspondence must mention the conversion and the company's former name.
Compliance changes.
| Private limited company | LLP | |
|---|---|---|
| Annual ROC filings | AOC-4 and MGT-7 or MGT-7A, additional fee ₹100 a day per form | Form 11 and Form 8 |
| Audit | Statutory audit in every case | Audit only above the turnover or contribution limits in the LLP Rules |
| Governance | Board meetings, general meetings, registers, resolutions | The LLP agreement decides |
| Raising equity | Shares, ESOPs, priced rounds, convertible instruments | No share capital; investors are partners |
Think twice if. You plan to raise institutional equity, grant ESOPs to employees, or take the company public. Investors price and paper equity rounds in companies, not LLPs, and moving back later means a fresh incorporation. If lighter compliance is the goal but equity matters, compare the running cost of a small company first: see private limited company, LLP registration and ROC compliance.
After registration
- File Form 3 with the stamped LLP agreement within 30 days, and Form 14 with the ROC within 15 days.
- Apply for PAN and TAN in the LLP's name, and open the bank account in the LLP's name.
- Move GST, Udyam, IEC, professional tax and labour registrations to the LLP. GST is not portable: the LLP registers in its own name and the company's registration is cancelled. See GST registration and Udyam registration.
- Reissue letterheads, invoices and contracts in the LLP's name, and note the conversion on correspondence for twelve months.
- Update the LLP agreement before adding a new partner: see LLP agreement change and add designated partner.
Other conversions into a company: OPC to private limited and partnership to private limited.