There are some good reasons why it makes ample sense to register your company. The first basic reason is to guard one’s own interests but not risk personal belongings to the stage that facing bankruptcy in case your business faces a crisis and also is forced to seal down. Secondly, it is much easier to attract VC funding as VCs are assured of protection if an additional is accredited. It provides tax benefits to the entrepreneur typically in a partnership, an LLP potentially a limited company. (These are terms which have been described later on). Another valid reason is, just in case a limited company, 1 wishes managed their shares to another it’s easier when company is recorded.
Very almost always there is a dilemma as to when business should be registered. The solution to which is, primarily, in case business idea is good enough to be converted to a profitable business or never ever. And if the answer to method has . confident and also resounding yes, then it is time for someone to go ahead and register the new. And as mentioned earlier on it’s always beneficial to make it work as a preventive measure, before important work saddled with liabilities.
Depending upon the size and type of the actual and how i want to flourish it, your startup could be registered among the many legal formats with the structure on the company accessible to you.
So permit me to first educate you with the mandatory information. The various company structures available are:
a) Sole Proprietorship. Of the company managed or run by one particular individual. No registration becomes necessary. This is the method to if you should do it all by yourself and the reason for establishing the company is to realize a short-term goal. But this puts you prone to losing your own personal assets should misfortune strike.
b) Partnership firm. Is owned and operated or run by at least two or more than two individuals. You should a Partnership firm, just as the laws aren’t as stringent as that involving Ltd. Company, (limited company) it demands a associated with trust within partners. But similar using a proprietorship answer to your problem risk of losing personal assets in any eventuality.
c) OPC Company Registration in India Online is a Person Company in that the company is a separate legal entity which in effect protects the owner from being personally to blame for any cutbacks.
d) Limited Liability Partnership (LLP), where the general partners have limited liability. LLP combines the best of partnership firm and an organisation and the partners aren’t personally liable to lose their personal power.
e) Limited Company which is of 2 types,
i) Public Limited Company where minimal number of members needed are 7 and there isn’t a upper limit; the associated with directors must be at least 3 and
ii) Private Limited Company where minimal number folks needed are 7 having a maximum upper limit of fifty five. The number of directors must be 2.