Company v/s Proprietorship

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varun gupta (Querist)
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06 May 2009 What are the benifits of converting a proprietorship into a Company or in which cases it would be benificial? What are the advantages which only a Company has and not a proprietorship?

Manju navandhar

Manju navandhar (Expert)
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07 May 2009 By converting a proprietory concern into a company,we can have easy access to loans from financial institutions like banks& also access to Stock market. so if u want to expand,a company is a better option.But if financing is not an issue then proprietory form of organisation is better as you have several tax advantages like no FBT, No Flat rate of tax, no MAT, etc.

varun gupta

varun gupta (Querist)
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21 May 2009 As far as benifits of Loans from Financial institutions is concerned, i think even a proprietorship with good balance sheet with good turnover like any company can also avial this benifit and Banks are not bound to give loans to companies only and not proprietorships. Despite these things, it is commonly seen that many small proprietorships are converted into Pvt cos. Any other specific benifit?

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