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Question ID : 41102

conversion of sole proprietorship to partnership

Dear all, Let us say 1.X and co is a sole proprietorship with x as the sole proprietor in existence for 3 years, 2.xy and co is a partnership firm with x and y as partners in existence for 1 year 3.Can both x( sole proprietor) and xy and co merge and start a new firm and will the experience of the sole proprietor x continue to the newly formed firm

Posted by SIVAKANTH BADIDA on Jul 20, 2021


Answer ID : 81203

Yes, Firm XY can take benefit of sole proprietor firm X through merger.

Posted by JITENDRA KANKOTIYA on Jul 21, 2021
Answer ID : 81204

If new firm will be formed by changing name, experience of proprietorship firm will not be continued to the newly formed firm.

Posted by CA. chunauti dholakia on Jul 21, 2021
Answer ID : 81207

Hi, From the question I understand that X and Y intend to constitute a partnership firm and leverage the standing of Proprietor firm of X. In order to continue the Same, I believe that the existing partnership Firm of X and Y needs to be dissolved and Y be added as partner in proprietor firm X. With the addition of Y, the proprietor will be re-constituted as partnership firm.

Posted by MAHESH JHAWAR on Jul 24, 2021