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

Answer ID : 81203

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

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.

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.

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