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How to transfer proprietorship from mothers name to my name
05-Aug-2023 (In Property Law)
Hi we open an apparel company last year, which is a proprietorship on my mothers name, I want to change it to mine and want to be the authorised signatory.How can this be done, what documents will be required and from where we can seek help to make it as fast as possible. Looking forward to hear from you soon. Thanks! Dr Esheeta singh
If you own and operate your own business without having created a separate legal entity for the business, then you are a sole proprietor. Because a sole proprietorship does not require you to execute any legal documents to form, it can also be shut down without executing any legal documents. If, however, you wish to sell or transfer the business to another person, there are some steps you should take to ensure that the transfer is accomplished in a legal and binding manner.
Step 1
Inventory your business. Before you can sell or transfer your legal interest in the business, you must know exactly what those interests consist of first. List all your assets and debts as well as any stock on hand if applicable.
Step 2
Create a sales contract if you are selling the business. A contract to sell a sole proprietorship can be as simple, or complicated, as you choose to make it. At its most basic, it needs to list what you are offering to sell to the buyer, the total purchase price and the payment terms. Sample contracts can be found online or at a local stationary store.
Step 3
Execute title transfers or quitclaim deeds if applicable in favor of the new owner. If real property is part of the business, and you own the property free of any liens or encumbrances, then you may simply execute a quitclaim deed to effectuate the transfer. Other property, such as vehicles or machinery, will also need to be transferred into the new owner's name by signing the title over.
Step 4
Notify the secretary of state of the transfer of ownership if you have operated under an assumed name or a "doing business as" name. Although sole proprietorships are not required to file anything to become a legal business entity, many owners choose to use a name for the business other than the owner's name. If a name other than the owner's name is used, most states require you to file an assumed-name certificate or similar filing. If the new owner plans to use the same name, the secretary of state should be notifie
Step 1
Inventory your business. Before you can sell or transfer your legal interest in the business, you must know exactly what those interests consist of first. List all your assets and debts as well as any stock on hand if applicable.
Step 2
Create a sales contract if you are selling the business. A contract to sell a sole proprietorship can be as simple, or complicated, as you choose to make it. At its most basic, it needs to list what you are offering to sell to the buyer, the total purchase price and the payment terms. Sample contracts can be found online or at a local stationary store.
Step 3
Execute title transfers or quitclaim deeds if applicable in favor of the new owner. If real property is part of the business, and you own the property free of any liens or encumbrances, then you may simply execute a quitclaim deed to effectuate the transfer. Other property, such as vehicles or machinery, will also need to be transferred into the new owner's name by signing the title over.
Step 4
Notify the secretary of state of the transfer of ownership if you have operated under an assumed name or a "doing business as" name. Although sole proprietorships are not required to file anything to become a legal business entity, many owners choose to use a name for the business other than the owner's name. If a name other than the owner's name is used, most states require you to file an assumed-name certificate or similar filing. If the new owner plans to use the same name, the secretary of state should be notifie
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Adv. Siddhant Sharma
Delhi | 500+ Answers
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