Company Registration
Incorporation is the establishment of a new company. The corporation may be a company, a non-profit organization, a start-up, a micro, small or a medium scale business. MCA manages corporate affairs in India through the Companies Act, 1956, 2013 and other linked Acts, Bills, and Rules. The Ministry is centrally involved with the administration of the Companies Act 2013. Along with this, it is also engaged in Companies Act 1956 and the Limited Liability Partnership Act, 2008.
Register a company now to get funding and tax advantages.
Registration services in India with 3 simple steps:
- Register your directors with the MCA i.e. Ministry of Corporate Affairs
- Get direction to pick the right company name
- Enlist your company’s constitution (MoA and AoA)
A Certificate of Incorporation with PAN and TAN can be obtained post-approval of the company registration process. You can formally open a current bank account with the Certificate of Incorporation and start your company operations.
Why you should get your company registered?
- Getting Loans on the name of the company to invest in a different company.
- The benefit of your company being a “Separate legal entity” is also there.
- Liabilities of directors are limited, by which they will not be personally liable for company affairs.
- Director of the Company can get tax benefits.
- From the time of it’s establishment the company has the power to take, hold and dispose of the property.
- To build goodwill of your brand.
- You can have a global reach with your company.
- To establish a platform to deal with different kinds of “Industries, suppliers, vendors, and customers”.
- You can make a claim through your company, regarding any legal matter such as “Trademark infringement” and your company can also be sued by anyone, but your personal interests won’t be affected.
- You can distinguish yourself from others by entering into the corporate environment.
- You can designate money from the general public to invest in your Company.
Types of Company structure
Private limited company
A private limited company is a separate entity. The liability of the members of a “Private Limited Company” is limited to the number of shares individually owned by them and the shares of the company cannot be publicly traded.
Section 8 Company
Section 8 Company is listed under Section 8 of the Companies Act, 2013. It has been authorized for expanding commerce, art, science, education, research, social welfare, religion, for the protection of the environment, if there is any form of income, then it can only be used for advertising the objects of the company and no profit can be paid to it’s members. Both “Section 8 Company and Section 25 Company” are different forms of a company, which are registered under the Companies Act, 2013 for charitable or not-for-profit objectives.
One Person Company (OPC)
OPC stands as a separate legal entity from it’s members, offers limited liability to it’s shareholders, has a flow of business and is simple to incorporate. One person company is similar to a “Private limited company” but it only needs one single person.
Limited Liability Partnership
In the LLP partnership, every partner holds limited liabilities. It, hence, exhibits components of partnerships and corporations. In an LLP, each partner is not accountable or responsible for another partner’s misconduct or carelessness.
NBFC Company
Nidhi Company is a kind of Non-Banking Financial Company (NBFC). It is determined to borrow and give money to it’s members. It implants the habit of savings among it’s members and acts on the principle of mutual profit.
Eligibility to register in a company
Minimum 2 Person
A company can be enrolled in India, by at least 2 persons, who must act as the directors or shareholders of the company. The highest number of shareholders allowed is 200 and the company can have up to 15 directors.
Resident Director
One director of the company needs to be a resident of India. A person is assumed to be a resident if he or she stays in India for at least 182 days during the leading fiscal year, irrespective of their citizenship.
Capital Requirement
Invest as per the necessity of your business, and there is no minimum capital requirement as such to be kept in the company. However, the government fee on company registration is measured on the capital amount.
Unique Name of Company
The proposed name of the company must not be similar or identical to an existing “company’s name or LLP’s name”. Moreover, you must verify with the trademark registry to ensure that your chosen name for the company is also neither similar nor identical to any registered or applied trademark in India.
Online Business Registration
Benefits
Registering a company offers many advantages. A registered company shows genuineness and authenticity, which earns the trust of both the investors and the customers. Other benefits have been mentioned below:-
- Legal Identity or recognition of the company
- Numerous Tax Benefits
- Get investment or funding for your company
- Your liability as a person is limited
- Increase brand image and developed trust factor
- Protection from personal liability and shields from other risks and losses.
- Gets bank credits and good investment from regular investors with ease.
- Gives liability protection to preserve your company’s assets
- More comprehensive capital contribution and higher stability
Formulation of Company Name
Company Registration Process
Steps to obtain Company Registration
Company Registration in India will bring in a new era of start-ups and provide an extra edge over those companies which have not been registered. The Ministry of Corporate Affairs oversees the company registration aspect, by adhering to the rules and regulations framed in accordance with the law. The steps which are included in the “Company registration procedure”, have been mentioned below:-
- Step 1: Application for Digital Signature Certificate
- Step 2: Apply for the Director Identification Number
- Step 3: Application for the name availability.
- Step 4: Filing of the MOA and AOA in case of certain types of companies like a “Private Limited Company
- Step 5: Apply for the PAN and TAN of the company
- Step 6: “Certification of incorporation” issued by ROC with PAN and TAN
- Step 7: Starting a current bank account with the company name
Documents Required for Company Registration
- Copy of PAN Card of directors
- 2 Passport size photograph of directors
- ID proof Aadhaar Card or Voter identity card of directors
- Copy of address proof rent agreement or property papers
- Electricity or Water bill of company place
- Landlord NOC
Importance of choosing the right company structure
It is necessary to choose your company structure carefully as your “Income Tax Returns” will depend on it. While enrolling your enterprise, remember that every company structure has different levels of compliances that must be met. For example, a sole proprietor has to register only an income tax return. Though, a company has to register an income tax return along with annual returns with the registrar of companies.
A company’s account books are to be mandatorily audited all year. Meeting certain legal compliances require spending money on auditors, accountants and tax filing experts. Hence, it is necessary to choose the right company structure when considering company registration. An entrepreneur must have a fair idea of the kind of legal compliances he or she is ready to deal with.
While some company structures are more investor-friendly than others, investors will always favor a verified and legal company structure.
How to choose a company structure while applying for company registration in India?
Let’s take a look at a few important questions, which an entrepreneur must ask himself before he or she finally decides upon a company structure.
How many owners or partners will your company have?
If you are a single person who holds the whole initial investment amount needed for the company, then a “One Person Company” structure will be ideal for you. On the other hand, if your company has 2 or more owners and both are actively looking for investment from other parties, then either an “LLP or a Private Limited Company” structure will be more suitable for you.
Should your first investment determine your choice of the specific “Company Structure”?
Yes if you need to contribute less initially, it will be wise for you to go in for a Sole Proprietor, or a HUF, or a Partnership. But, if you are sure that you will be ready to improve the setup and compliance costs, then you must opt for an OPC Company/an LLP, or a Private Limited Company.
Willing to have the whole liability of the company
Company structures like “a sole proprietor, HUF, and a partnership firm” have unlimited liability. This implies, in case of any error in loans, the complete money will be recovered from the members or partners in a profit-sharing ratio. The risk to personal assets is large in these cases.
Whereas, a “Private Limited Company and an LLP” have limited liability. This means that the liability of it’s members, is limited to the amount of contribution made by them or the value of shares every member holds.
Income Tax Rates Applicable to companies
The income tax rates applicable to a sole proprietorship and a HUF are the regular slab rates. In a sole proprietorship, the company income is clubbed with the individual’s other income.
But in the case of different entities like a partnership or a Pvt. Ltd. Company, then the tax rate of 30% is applicable.
Plans for getting money from investors
It is hard to get investments when your company structure is unregistered. Entities like an “LLP and a Private Limited Company” are trusted only when they fulfill all the necessary legal requirements. Make sure you pick the right structure, seek the help of a legal authority, so that you register under precise guidance.
Registration cost of a company
Registration provides various benefits to a company such as “Legal benefits to the company in respect of name approval, it’s field of operations, approval of it’s state of power and many more benefits” are given by the concerned authority when you are applying for company registration. Most countries have different rules and regulations for their corporate law services. Whether it is a “Big or micro company”, all entrepreneurs are required to go over all the steps of company law services. The steps and procedures under the company registration procedure, differ from one type of company to another.
The Cost of different company structures we offer are as follows:
- Private Limited Company-9,000/-
- Section 8 Registration-20,000/-
- OPC Private Limited Company-8,000/-
- Limited Liability Partnership-7,000/-
- Nidhi Company Registration-22,000/-
Comparison of company structures
It is very important to choose a company structure, which meets your requirements, among the different company structures. This table will help you to pick best.
| FEATURES | Private Limited Company | One Person Company | Limited Liability Partnership | Partnership Firm | Proprietorship Firm |
|---|---|---|---|---|---|
| Acts involved | Companies Act, 2013 | Companies Act, 2013 | Limited Liability Partnership Act, 2008 | Indian Partnership Act, 1932 | No specified Act |
| Separate Legal Entity | Yes | Yes | Yes | No | No |
| Registration Requirement | Mandatory | Mandatory | Mandatory | Mandatory | No |
| Number of members | 2 – 200 | 1 | 2- unlimited | 2-20 | 1 |
| Liability Protection | Limited | Limited | Limited | Unlimited | Unlimited |
| No.of Directors | 2-5 | 1-15 | 2 to unlimited | Not applicable | Not applicable |
| Statutory Audit | Compulsory | Compulsory | Dependent | Not Compulsory | Not Compulsory |
| Foreign Direct Investment | Yes | No | Yes | No | No |
| Annual Filings | Income Tax Returns with the ROC | Income Tax Returns with the ROC | Filed with the ROC | Filed with the ROC | Filed with the ROC |
| Ownership Transferability | Yes | Yes | Yes | No | No |
| Rate of tax | Moderate | Moderate | High | High | Low |
