- +91 80768 85539
- info@expertvuw.com
- Pan-India service available.
Home / Change in Business Structure / Proprietorship to OPC Conversion Conversion
Last updated: 2 October 2026
Keep full ownership of your business while gaining limited liability and a separate legal identity. Our team incorporates the OPC, transfers the proprietorship business to it and moves your GST credit and registrations across.
There is no direct legal conversion of a proprietorship into a company. Instead:
The OPC’s sole member must be an Indian citizen and resident in India.
Based on the Companies Act, 2013, the Income-tax Act, 2025 and the CGST Rules. Last updated: 27 September 2026.
A new OPC takes over the proprietorship business
Business transfer agreement records the takeover
Voting power the former proprietor must keep for tax neutrality
No consideration other than shares for tax neutrality
Moves unused GST credit to the OPC
OPC member must be an Indian citizen resident in India
Tax conditions are strict and apply for five years.
Some business assets stay with the proprietor, breaking the tax-neutral conditions.
Consideration other than shares makes the transfer taxable.
ITC-02 not filed and credit is not carried over.
Other structure options.
Convert with more shareholders.
Forming an OPC.
Growing beyond one owner.
Registering the new entity.
Tax-neutral conditions and timeline mapped.
OPC incorporated with a nominee.
Business transfer agreement executed.
Assets and liabilities moved on tax-neutral terms.
New GST registration and ITC-02 filed.
Proprietorship registrations and accounts closed.
The OPC now has its own company compliance.
Keep at least 50% voting power for five years.
OPC files its own annual returns.
First auditor appointed within 30 days.
Proprietorship GST and licences cancelled.
Share your query and our team will reply during business hours.
No. A new OPC is incorporated and takes over the business under a business transfer agreement.
It can be tax-neutral if all assets and liabilities pass to the OPC, the proprietor keeps at least 50% voting power for five years and takes only shares as consideration.
Unused input tax credit can be moved to the OPC by filing Form GST ITC-02.
A natural person who is an Indian citizen and resident in India.
Yes, by voluntary conversion at any time.
ACS – Director, Expertvuw Management Pvt Ltd
This work is handled by Expertvuw’s team, with filings made on the MCA portal. Certifications and audits required by law are issued by independent practising professionals engaged for your case.