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Convert Sole Proprietorship to Private Limited Company

Proprietorship Company is the type of business where there is just one owner. His role is just like the king in the company as he has the overall hold on the organisation in all the aspects. He has the right over all the decision he takes and he is the sole responsible person for any profit or losses of the company.

A private limited Company is also known as the LTD. This type of business limits the liability of the owners to its shares. This also restricts the shareholders from trading shares publicly

Benefits of Private Limited Company

The liability of shareholders is limited to the shares.

There is no risk of taking over as either of the partners will violate the rule if selling or buying of the shares is done without the consent of each other.

The company would not shut down even if one of the partners dies

Either of the partners can raise investment in the business and it is not just restricted to one person.

Private Limited companies will pay the taxes as per their profit. Tax will be paid in terms of the personal income tax rate

Sole Proprietorship is not meant for the medium scaled or large scale business where as Private Limited Companies can have their roots in the large scaled business.

In the Sole Proprietorship the burden of the losses will be incurred by a single person, while in the LTD, the losses and the profits are equally distributed