If you intend to launch a firm, there are numerous business structures. The organizational structure you select will dictate the taxes you must pay, the compliance requirements you must adhere to, and the eligibility requirements you must satisfy. Therefore, choosing which type of online company registration is best in India is one of the most important decisions an entrepreneur has to make.
Types of Company Registration In India
Entrepreneurs must ensure they select a company type that fits their operations because there are many different business forms in India. online company registration is the main method business owners use to find or incorporate their firm.
The Companies Act of 2013 in India offers seven alternative types of company registration options:
- Public Limited Company
- Private Limited Company
- Limited Liability Partnership
- One Person Company
- Sole Proprietorship
- Section 8 Company
Public Limited Company It refers to a business that
(a) is not a private business.
(b) is a private company subsidiary of a business that is not private;
(c) has a minimum paid-up capital of five lakh rupees or any greater paid-up capital that may prescribed.
The eligibility criteria for a Public Limited Company registration are:
(i) Consequently, a public corporation can: invite or accept public deposits;
(ii) Invite or accept the general public to subscribe to its shares and debentures; (iii) Invite or accept the general public to limit the number of members; and
(iv) Do not prohibit the transfer of its shares. A public company registration requires at least seven people.
Public Limited Company Registration Process
Ensure the firm has a minimum of seven shareholders, three directors, and capital of at least 5,00,000 before applying for the online company registration process.
A DSC (Digital Signal Certificate) is also needed when submitting documentation for identification and residence.
Apply for a DPIN and include your firm’s name in the application. Ensure that the application must have the business’s objective clauses. This section typically outlines the precise rationale behind the online company registration founding, its established time, and its numerous tasks.
To apply for ROC, attach the important documents, such as MOA, AOA, Form INC-7, Form DIR-12, and Form INC-22.
After paying the registration cost and receiving the ROC’s permission, the business must file for the “Certificate of Commencement.”
Private Limited Company
It refers to a business prescribed by its articles of association to have a minimum paid-up capital of one lakh rupees or a higher paid-up capital.
(a) Restricts its members’ ability to transfer shares, if any; and,
(b) Except in the case of one person company caps the number of members at 200, excluding those who are or were employed by the company:
(c) forbids inviting the public to subscribe to any of the company’s securities;
(d) forbids inviting or accepting deposits from anybody other than its directors, members, or their family.
Two members are needed to create a private company. A firm of this type must have the word “private” in its name. Under the Companies Act, a private business is given unique benefits and exclusions. It usually involves family members.
Private Limited Company Registration Process
Directors should apply for the DPIN and digital signature (Director PIN assigned by the MCA).
Give the MCA any appropriate three names you like for your business. MCA then decides on one of them.
Upload your MOA and AOA.
Obtain a company incorporation certificate, which will also provide you with a CIN number and legal proof of your company’s existence.
Finally, submit the documents, such as MOA, AOA, and PAN, to apply for PAN, TAN, and bank accounts.
A partnership may be defined as a voluntary association of two or more persons who have agreed to share profits of a lawful business carried on by all or any one of them acting for all. Individual partners and the collective firm are the individuals who enter into a partnership.
There are four kinds of partnership:
Limited Liability partnership
Partnership at will
Following are the requirements to form a partnership:
- It should have a minimum of two and a maximum of ten partners.
- Must have an Indian registered office address
- All partners must sign a registered partnership deed.
Note: Partnership companies does not require a registration. But by doing so, you can gain a few advantages.
Limited Liability Partnership
A limited liability partnership is one in which each partner’s liability is capped at the amount of capital they have invested. It is a body corporate with a separate legal identity from its partners. A partner’s personal property is not held responsible for the firm’s debts. As per the 2008 Limited Liability Partnership Act, such partnerships are required to register. It must keep yearly financial records that accurately portray its current situation.
The following requirements must be satisfied for an LLP company registration:
One lakh is the minimum amount of authorized capital.
The chosen partners must all reside in India, or at least one of them.
Minimum of two partners, with no cap on the maximum number
Since each partner must provide a mutually agreed-upon contribution, there is no need for shared capital.
Limited Liability Partnership Registration Process
Get your LLP partners’ DSCs and DINs. Most of the time, a DIN or DPIN registration may done instantly. Each partner must have one DIN.
Apply for MCA, which ROC will process get your business name approved.
Once the senior officials approve the firm name, the partners will receive an application.
Finally, the partner has 60 days after the date of receipt of this application to send the necessary documents. You must apply to the partnership agreement within 30 days of receiving the registration certificate.
One Person Company
One person companies may established under the 2013 Companies Act. A one-person company, as the name implies, only has one owner. The name of the business will include the letters “OPC.” Forming an OPC follows the same steps as setting up a private limited company. Since there is only one business owner, he must designate someone to run it in the event of his passing or incapacity. The nominee’s written consent required, and it must be submitted to the Registrar of Companies.
An OPC is excluded from carrying out annual general meetings, general meetings, and extraordinary general meetings, among other procedural formalities. If there is only one director, there are no requirements for holding board meetings; however, if there are many directors, two meetings must held annually. The corporation must informed of and notified of any resolution made by the lone member. However, there is no exemption from the requirements for private corporations regarding audits, financial statements, and accounts.
One Person Company Registration Process
First step is to obtain a DSC, then apply for DIN.
Submit an application to MCA for approval of the firm’s name.
After submitting the necessary documents to MCA, the government will issue an incorporation certificate.
Different terms, such as sole trader’s business, used to describe a sole proprietorship. It is the oldest, simplest, and most typical type of business organization. A single person establishes, finances, owns and manages a sole trader business. The business owner assumes all of the risks and keeps all the rewards.
One individual owns and controls a sole proprietorship, which has one of its three qualities.
(i) A Sole proprietorship owned, controlled and managed by a single individual.
(ii) It has no separate legal entity distinct from its owner.
(iii) A sole proprietor has unlimited liability.
Sole Proprietorship Registration Process
Apply for a PAN card if you don’t already have one, then let your employer know.
Open a business account to register under the MSME Act as an SME. Registration typically not required, although it possible to register to get government benefits or awards.
Make sure you have GST registration if your annual revenue exceeds 20,00,000.
Section 8 Company
Section 8 companies, commonly known as non-profit organizations, operate for philanthropic causes. The goal of Section 8 company is to advance the sciences, humanities, humanitarianism, literature, education, and environmental protection. Additionally, all their income spent to accomplish these goals, and none of the members receive dividends.
You must satisfy the following requirements for a Section 8 company registration:
It should have two shareholders or more
Two minimum, and they may also be stockholders, directors
At least one of the directors must be a resident of India.
No minimum investment is necessary
Must have an Indian registered office address.
Section 8 Company Registration Process
For DIN and DSC, all partners must apply.
Select one of the three names for the business and obtain MCA approval.
If the official asks, provide the department’s or the appropriate higher authority’s approval.
Obtain the Section 8 company license from MCA after obtaining the firm name.
Therefore, forming a online company registration is a key step in achieving your goal of being a prosperous entrepreneur. Start now by using the information provided!
Our specialists at Lawgical India are ready to help you with all of your legal business challenges if you run into any issues with company registration.