Partnership to LLP Conversion: Convert Your Firm into an LLP
A partnership firm can convert into a Limited Liability Partnership under Section 55 of the LLP Act, 2008, keeping its business, assets and partners while gaining limited liability. The application is Form 17 with FiLLiP on the MCA V3 portal, and the new LLP must inform the Registrar of Firms within 15 days.
What it is
Partnership to LLP conversion moves an existing firm, with its whole undertaking, into a Limited Liability Partnership. Unlike registering a fresh LLP, nothing restarts: the same business carries on under the new name. Its assets, liabilities, contracts and rights pass to the LLP, and the firm is treated as dissolved.
The law is Section 55 of the Limited Liability Partnership Act, 2008, read with the Second Schedule, and Rule 38 of the LLP Rules, 2009. You apply in Form 17 (Part A application, Part B statement of partners) together with the FiLLiP incorporation form on the MCA V3 portal. The Registrar issues a certificate of registration in Form 19.
Who it applies to
Firms that want limited liability
In a firm, every partner is personally liable for the firm’s debts. In an LLP, liability for future debts stops at the partner’s agreed contribution, except in cases of fraud.
Registered and unregistered firms
Section 55 speaks of a “firm” and does not ask for registration. A firm that completed its registration with the Registrar of Firms attaches the certificate; an unregistered firm usually relies on its deed and tax records. We confirm the current MCA requirements first.
Firms keeping the same partners
The LLP’s partners must be all the partners of the firm and no one else. New partners can join only after the conversion.
Why it matters
Keep future debts off your home
Future business debts stay with the LLP. Here is the catch: the old firm’s liabilities before conversion still bind the partners, so the protection works going forward, not backwards.
Outlive any one partner
An LLP has perpetual succession. A partner’s death or exit does not dissolve it, and it can own property and sue in its own name.
Keep the same tax rules
For income tax an LLP is still a “firm”. It pays 30% plus cess, and partner remuneration rules do not change.
Documents required
From the firm
- Partnership deed and all supplementary deeds
- Registration certificate, if the firm is registered
- Firm PAN and latest ITR acknowledgement
- Statement of assets and liabilities certified by a practising CA
Consents
- Consent of all partners to the conversion
- List of secured creditors with their consent
- Consent of each designated partner
From the partners
- PAN, identity and address proof
- DIN, or details for allotment through FiLLiP
- Digital signature certificate of designated partners
- Proof of the LLP’s registered office
Partnership firm vs LLP at a glance
| Partnership firm | LLP | |
|---|---|---|
| Law | Indian Partnership Act, 1932 | LLP Act, 2008 |
| Liability of partners | Unlimited, joint and several | Limited to contribution (not for fraud) |
| Legal status | Not separate from partners | Body corporate with perpetual succession |
| Registrar | State Registrar of Firms | ROC on the MCA portal |
| Annual filings | ITR; no MCA forms | ITR, plus Form 11 by 30 May and Form 8 by 30 October |
| Income tax rate | 30% plus cess | 30% plus cess |
The trade-off is simple: limited liability in exchange for yearly MCA filings. A two-partner consultancy with modest turnover may find the extra filings outweigh the benefit; a trading firm carrying supplier credit usually finds the opposite. An LLP also needs an audit once turnover exceeds ₹40 lakh or contribution exceeds ₹25 lakh.
How it works
Check eligibility and the books
We confirm every partner is joining, list the secured creditors and get the CA-certified statement of assets and liabilities prepared. Picture a Faridabad auto-parts firm with a cash-credit limit from its bank: the bank’s consent letter is usually the slowest document, so we ask for it on day one.
Reserve the LLP name
We file RUN-LLP on the MCA V3 portal. Most firms keep their trading name and add “LLP”.
File FiLLiP with Form 17
We file the incorporation form and Form 17 together, with the consents and statements, signed with designated partners’ DSCs.
Get the certificate and file the agreement
Once the Registrar issues Form 19, we draft the LLP agreement and file it in Form 3 within 30 days.
Inform the Registrar of Firms and update registrations
We file Form 14 with the Registrar of Firms within 15 days and update PAN, TAN, GST, bank accounts and licences.
Timelines
Timing depends on ROC queries
Name approval and registration run at the Registrar’s pace. We give you a date once we have seen your deed and books.
Tell the Registrar of Firms in 15 days
The LLP informs the Registrar of Firms of the conversion in Form 14 within 15 days of registration.
File the LLP agreement in 30 days
Form 3 with the LLP agreement is due within 30 days of incorporation. Annual Form 11 and Form 8 follow from the first financial year.
What happens if a step is missed
Late Form 3 costs more
Since 1 April 2022, a late LLP form pays an additional fee that is a multiple of the normal fee, and the multiple climbs with the delay.
The old firm lingers
Skip Form 14 and the firm still shows as active with the Registrar of Firms, and banks ask which entity they are dealing with.
Old registrations stay in the firm’s name
GST, licences and bank accounts left unchanged keep running in the firm’s name, and returns stop matching payments.
Frequently asked questions
Can an unregistered partnership firm convert into an LLP?
Usually yes. Section 55 of the LLP Act, 2008 refers to a “firm” and does not itself require registration. A registered firm attaches its certificate from the Registrar of Firms; an unregistered firm shows it exists through its partnership deed, PAN and income tax returns. Some practitioners advise registering first, so we check the current MCA requirements before you commit.
Can we add a new partner during the conversion?
No. Under the Second Schedule, the partners of the LLP must be all the partners of the firm and no one else at the time of conversion. A new partner can be admitted after the LLP is registered, by changing the LLP agreement and filing the change on the MCA portal. Convert first, then add the new partner.
Which forms are filed to convert a firm into an LLP?
Four forms in sequence. RUN-LLP reserves the name, with a ₹200 fee. FiLLiP is filed together with Form 17, which carries the application and the statement of partners. After the Registrar issues the certificate in Form 19, the LLP files Form 14 with the Registrar of Firms within 15 days, and Form 3 with the LLP agreement within 30 days. We handle each one on the MCA V3 portal.
What happens to the firm’s assets and liabilities?
They pass to the LLP. On conversion, all tangible and intangible property, liabilities, rights, privileges and obligations of the firm vest in the LLP, and the firm is treated as dissolved. Partners remain personally liable for the firm’s obligations incurred before the conversion. Contracts and pending proceedings continue with the LLP. We list the assets and creditors in advance, so the transfer is clear on paper.
Is there capital gains tax when a firm converts into an LLP?
It depends on the facts. The Income-tax Act has a specific exemption for a company converting into an LLP (Section 47(xiiib), now Section 70(1)(ze) of the 2025 Act), but it does not cover firms. A firm conversion where assets move at book value and partners keep the same capital accounts is usually lower risk. Revaluing assets just before conversion changes that. We review the balance sheet before filing so the tax position is known.
Do secured creditors have to agree to the conversion?
Yes, in practice their consent is attached. Form 17 carries a list of the firm’s secured creditors along with their consent to the conversion. If the firm has a bank or vehicle loan, we request the lender’s no-objection letter early, because banks take time.
How many designated partners does the LLP need?
At least two designated partners, and at least one of them must be resident in India. Designated partners are responsible for the LLP’s filings and compliance, and each needs a DIN and a digital signature certificate. A firm with two partners simply makes both of them designated partners. A partner without a DIN gets one through FiLLiP itself.
What annual compliance does the LLP have after conversion?
The LLP files Form 11, the annual return, by 30 May and Form 8, the statement of account and solvency, by 30 October every year, even with nil activity. It also files its income tax return, and gets its accounts audited once turnover exceeds ₹40 lakh or contribution exceeds ₹25 lakh. Late LLP forms carry a multiple of the normal fee.
What it costs
Our fee plus the government fee that applies to your case, quoted before you commit. Tell us the situation and we will price it exactly.
RUN-LLP for the name costs ₹200. The fees for FiLLiP and Form 17 depend on the contribution of the LLP, and stamp duty on the LLP agreement depends on your state.
Ready to begin?
Share your partnership deed and latest balance sheet, and we will tell you what your partnership to LLP conversion involves.