Step-by-Step Guide 6 Steps

How to Convert LLP to OPC (One Person Company) in India

Step-by-step guide to converting an LLP to a One Person Company (OPC). Covers eligibility, MCA forms, board resolutions, compliance, tax implications, and timeline.

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Dhanush Prabha
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How to Convert LLP to OPC (One Person Company) in India
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Quick Overview
Estimated Cost₹15000
Time Required2 to 4 Months
Total Steps6 Steps
What You'll Need

Documents Required

  • LLP Agreement and Certificate of Incorporation of the existing LLP
  • Consent of all LLP partners for conversion (partner resolution)
  • Audited financial statements of the LLP for the current and previous year
  • Asset and liability statement of the LLP as on the conversion date
  • NOC from all creditors of the LLP
  • Identity and address proofs of the proposed OPC sole member and nominee
  • DSC and DIN of the proposed OPC director

Tools & Prerequisites

  • Tax Professional for asset valuation, tax planning, and compliance filings
  • Compliance Professional or legal counsel for MCA filings and regulatory compliance
  • Access to MCA21 portal at mca.gov.in for OPC incorporation and LLP closure
  • Digital Signature Certificate for the proposed OPC director

Converting an LLP to a One Person Company (OPC) in India requires a two-step approach because no direct statutory conversion mechanism exists. The process involves incorporating a new OPC, transferring all assets and liabilities from the LLP to the OPC through a Business Transfer Agreement, and then closing the LLP using Form 24. The conversion takes 2 to 4 months and costs Rs 15,000 to Rs 50,000 (excluding property stamp duty). Before proceeding, evaluate whether a private limited company would be a better fit given OPC's turnover and capital caps.

  • No direct conversion: LLP to OPC requires incorporating new OPC + closing LLP
  • OPC caps: Rs 2 crore turnover and Rs 50 lakh paid-up capital limits
  • Timeline: 2-4 months including OPC incorporation and LLP closure
  • Cost: Rs 15,000-50,000 (government fees, legal, Expert, and stamp duty)
  • Alternative: Consider private limited company for better scalability

What is an OPC (One Person Company)?

A One Person Company (OPC) is a form of company under Section 2(62) of the Companies Act, 2013 that allows a single individual to operate a company with limited liability. Unlike a sole proprietorship, an OPC provides the owner with separate legal entity status and limited liability protection. The OPC structure was introduced to encourage sole entrepreneurs to formalize their businesses while maintaining the simplicity of single ownership. The key feature is the mandatory nominee requirement -- a person who takes over the company if the sole member dies or becomes incapacitated.

OPCs are governed by Section 2(62) and Section 3(1)(c) of the Companies Act, 2013 and the Companies (Incorporation) Rules, 2014. The OPC concept was introduced by the Companies Act, 2013 (not available under the old 1956 Act). Key provisions: Section 2(62) (definition), Rule 3 (eligibility), and Rule 6 (mandatory conversion thresholds). Incorporation is through the MCA portal using SPICe+ form.

LLP vs OPC: Comparison

FeatureLLPOPC
Governing LawLLP Act, 2008Companies Act, 2013
Minimum Members2 partners1 member (+ 1 nominee)
LiabilityLimited to contributionLimited to share capital
Turnover CapNo capRs 2 crore (mandatory conversion above)
Capital CapNo capRs 50 lakh paid-up
Tax Rate30% flat (or slab for individual partners)25% corporate tax
Audit RequirementAbove Rs 40 lakh turnover or Rs 25 lakh contributionAbove Rs 1 crore turnover (old regime)
Equity InvestmentNot standard equity; partner contributionCannot issue shares to others
Annual FilingsForm 8 + Form 11AOC-4 + MGT-7A
Board MeetingsNo requirement1 board meeting per half-year

Based on our experience handling 200+ entity conversions, most clients who plan LLP to OPC conversion end up choosing private limited company instead. The reason: OPC's Rs 2 crore turnover cap is too restrictive for growing businesses. When you exceed Rs 2 crore, mandatory conversion to private limited adds another round of costs and compliance. If your business is growing, skip OPC and convert directly to private limited (which has a defined statutory process under Section 366).

Step-by-Step Conversion Process

Step 1: Evaluate and Plan

Before starting, verify that OPC is the right structure: single owner (sole founder), turnover below Rs 2 crore (and likely to stay below), no plans for equity investment, and the owner meets OPC eligibility (Indian citizen, resident). Identify the nominee for the OPC. Plan the asset transfer structure with your Expert to minimize tax impact. Obtain partner consent for the LLP closure and business transfer.

Step 2: Incorporate the New OPC

File SPICe+ on the MCA portal for OPC incorporation. Part A reserves the name (2 options). Part B completes incorporation with: member/director details, registered office address, authorized and paid-up capital, and subscriber details. Simultaneously file AGILE-PRO-S for GST/EPFO/ESIC and INC-3 for nominee consent. The MCA issues the Certificate of Incorporation with CIN within 7-15 days. Open a bank account in the OPC's name.

Step 3: Transfer Business from LLP to OPC

Execute a Business Transfer Agreement (BTA) transferring all LLP assets and liabilities to the OPC as a going concern. The BTA covers: movable property (equipment, inventory, receivables), immovable property (registered transfer deed), intellectual property (assignment deeds), contracts (novation/assignment), employees (transfer letters), and liabilities (assumption by OPC). Structure the transfer as a going concern to benefit from GST exemption under Schedule II. Value the transfer at book value to minimize capital gains.

Transferring immovable property from the LLP to the OPC attracts stamp duty at state-specific rates (typically 2-8% of market value). This is often the largest cost component of the conversion. Some states offer reduced stamp duty for business reorganization, but this must be verified with the local Sub-Registrar. If the LLP owns significant property, the stamp duty cost may make the conversion uneconomical. Consider retaining property in the LLP and leasing it to the OPC instead.

Step 4: Settle Partner Accounts and Close LLP

Settle all LLP partner capital accounts. The continuing partner converts their capital to OPC share capital. Exiting partners receive cash settlements. After all assets and liabilities are transferred and partners are settled, the LLP should have nil assets and nil liabilities. File Form 24 with the LLP Registrar for striking off. Attach: partner consent, statement of accounts, indemnity bond, and NOCs. Surrender PAN and TAN. Cancel GST registration. The LLP is struck off after the 30-day gazette period.

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Cost Breakdown

ComponentAmount (Rs)Notes
OPC Incorporation (SPICe+)3,000-8,000Government fees + professional
Business Transfer Agreement2,000-5,000Legal drafting
LLP Closure (Form 24)1,500-3,000Filing fees
Expert Fees5,000-15,000Valuation, tax planning, filings
GST Migration0-2,000New registration + old cancellation
Miscellaneous2,000-5,000DSC, notarization, postage
Total (without property)Rs 15,000-38,000

Not sure if OPC is the right structure? Our business advisors can help you choose between OPC, private limited, and LLP.

Talk to a Business Advisor

Summary

Converting an LLP to OPC requires a two-step process: incorporate a new OPC and close the existing LLP after transferring all assets and liabilities. The process takes 2-4 months and costs Rs 15,000-50,000. Before converting, consider whether OPC's Rs 2 crore turnover cap and single-member restriction suit your business. For growing businesses, converting directly to a private limited company is often the better choice. If you proceed with OPC, structure the business transfer as a going concern for GST exemption and transfer assets at book value to minimize capital gains.

Expert LLP Conversion Support

We handle the complete process: OPC incorporation, business transfer, LLP closure, tax planning, and post-conversion compliance. Starting at Rs 15,000.

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Frequently Asked Questions

Can an LLP be directly converted to OPC?
No. The Companies Act, 2013 and the LLP Act, 2008 do not provide a direct statutory conversion mechanism from LLP to OPC. Unlike LLP to private limited company conversion (which has a defined process under Section 366 of the Companies Act and LLP Rules), LLP to OPC requires a two-step approach: incorporating a new OPC and winding up the existing LLP after transferring assets and liabilities. This is similar to how sole proprietorship to OPC conversion works.
Why would someone convert LLP to OPC?
Common reasons: one partner wants to exit the LLP leaving a single owner, the business has outgrown the partnership model and needs corporate structure, the owner wants limited liability with single ownership, the business needs better credibility (company vs LLP perception), regulatory requirements for certain industries requiring a company structure, and the owner prefers OPC's simplified compliance (no requirement for annual meetings, single director/member decisions).
What are the eligibility criteria for OPC?
OPC eligibility under the Companies Act, 2013: only a natural person who is an Indian citizen and Indian resident can be the sole member (NRIs can also form OPC since 2021 amendment), the member must nominate a nominee (who takes over if the member dies or becomes incapacitated), OPC turnover must not exceed Rs 2 crore (otherwise mandatory conversion to private limited), and paid-up capital must not exceed Rs 50 lakh. Only one OPC per person is allowed.
What is the cost of converting LLP to OPC?
Costs: OPC incorporation: Rs 3,000-8,000 (government fees + professional fees), Business Transfer Agreement: Rs 2,000-5,000, stamp duty on property transfer: 2-8% of value (state-specific), LLP closure (Form 24): Rs 1,500-3,000, Expert fees: Rs 5,000-15,000, legal counsel: Rs 5,000-10,000, new GST registration: Rs 0-2,000, and miscellaneous: Rs 2,000-5,000. Total: Rs 15,000-50,000 (without property stamp duty). Property transfers significantly increase costs.
How long does LLP to OPC conversion take?
Timeline: OPC name reservation and incorporation (7-15 days), business transfer agreement and asset transfer (2-4 weeks), GST migration and license updates (2-4 weeks), LLP closure filing and RoC processing (2-3 months). Total: 2-4 months. The LLP closure is the longest step because the RoC publishes the name for 30 days before striking off. Running the OPC incorporation and LLP closure in parallel saves time.
What are the tax implications of LLP to OPC conversion?
Tax implications: capital gains tax on transfer of LLP assets to OPC (unless transferred at book value with slump sale provisions), stamp duty on property transfer deeds, GST implications on transfer of business as going concern (exempt under Entry 4 of Schedule II), partner capital settlement may trigger Section 45(4) capital gains, and the OPC starts with a fresh tax identity (new PAN, fresh ITR filing). Consult a Expert for tax-efficient structuring of the transfer.
What happens to LLP contracts after conversion?
LLP contracts are not automatically transferred to the OPC. Each contract must be individually assigned or novated. Send assignment notices to all contracting parties. Some contracts may have anti-assignment clauses requiring the counterparty's consent. For government contracts, the contracting authority must approve the entity change. For bank loans, the bank must approve the transfer and may require fresh documentation. Plan contract transfers well in advance of the LLP closure.
Can NRIs convert LLP to OPC?
Since the 2021 Companies (Amendment) Rules, NRIs and persons resident outside India can incorporate an OPC. However, the NRI must have spent at least 120 days in India during the immediately preceding financial year (residency requirement). The nominee must also be an Indian citizen. For NRI partners in an LLP, the conversion to OPC is feasible if one partner meets the residency requirement and the others agree to exit.
What are the disadvantages of OPC compared to LLP?
Disadvantages: turnover cap of Rs 2 crore (LLP has no cap), paid-up capital cap of Rs 50 lakh, only one member allowed (cannot add co-founders later), higher compliance costs (annual filing fees, audit requirement at lower thresholds), cannot raise equity from investors, mandatory conversion to private limited if thresholds are exceeded, and OPC is taxed as a company (25% corporate tax vs LLP's slab-based or 30% tax). Consider private limited company instead.
What documents are needed for OPC incorporation?
Documents: PAN and Aadhaar of the proposed member/director, passport-size photograph, address proof of registered office (electricity bill + NOC from owner), Digital Signature Certificate (DSC), Director Identification Number (DIN) (obtained through SPICe+), INC-3 nominee consent form with nominee PAN and Aadhaar, MOA and AOA (auto-generated in SPICe+), and declaration in Form INC-9. If the member already has a DIN and DSC from the LLP, those can be reused.
Should I convert LLP to OPC or private limited?
Choose OPC if: you are a solo founder with no plans to add co-founders, turnover will stay below Rs 2 crore, you don't need external equity investment, and you want simpler compliance. Choose private limited if: you plan to add co-founders or investors, turnover may exceed Rs 2 crore, you need to raise venture capital or angel funding, or you want maximum flexibility for growth. Private limited is preferred for most businesses due to fewer restrictions and better scalability.
What happens to LLP employees during conversion?
LLP employees are transferred to the OPC through the Business Transfer Agreement. Issue transfer letters to all employees specifying: new employer entity (OPC), continuity of service for gratuity and leave purposes, same terms and conditions, and PF transfer details. The transfer should be structured as a going concern transfer to preserve employee continuity. File revised EPF and ESI registrations under the new OPC entity. Issue revised appointment letters with OPC details.
How to handle GST during LLP to OPC conversion?
GST steps: apply for new GST registration for the OPC (separate GSTIN), transfer the business as a going concern from LLP to OPC (exempt from GST under Entry 4, Schedule II), issue a final GST return for the LLP, apply for cancellation of LLP's GST registration, transfer input tax credit through ITC-02 form (available for business reorganization), and update all e-invoicing and e-way bill settings for the new OPC GSTIN.
What is Form 24 for LLP closure?
Form 24 is the application for striking off an LLP name filed with the Registrar under the LLP (Winding Up and Dissolution) Rules. Requirements: nil assets and nil liabilities at the filing date, all partners' consent, indemnity bond from designated partners, statement of accounts (not older than 30 days), NOC from creditors, and filing fee of Rs 50 per partner. The Registrar publishes the name for 30 days. If no objections, the LLP is struck off.
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Guide by Dhanush Prabha

Dhanush Prabha is the Chief Technology Officer and Chief Marketing Officer at IncorpX, leading platform development, digital growth, and product strategy. With experience in full-stack development, scalable systems, SEO, and marketing automation, he focuses on building technology-driven solutions and educational business resources for startups and growing businesses. He writes on technology, entrepreneurship, business setup processes, and digital transformation.