There are a couple of good the actual reason why it makes ample sense to register your little. The first basic reason is to guard one’s own interests as an alternative to risk personal belongings to the point of facing bankruptcy in case your business faces a crisis and and that is forced to seal down. Secondly, it is a lot easier to attract VC funding as VCs are assured of protection if this company is registered. 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, if one wishes managed their shares to another it’s easier when company is enrolled.
Very often there is a dilemma as to when the company should be registered. The solution to which is, primarily, in case business idea is sufficiently good to be converted into a profitable business or not solely. And if the answer to that is a confident and also resounding yes, then it’s time for in order to go ahead and register the new. And as mentioned earlier on it will be beneficial to write it as a preventive measure, before you will be saddled with liabilities.
Depending upon the size and type of the business and like you would want to be expanded it, your startup can be registered among the many legal formats belonging to the structure in a company available to you.
So ok, i’ll first educate you with the required information. The various company structures available are:
a) Sole Proprietorship. It is a company owned and operated or run by just one individual. No registration is needed. This is the method to be able to if for you to do it all by yourself and the goal of establishing the organization is gain a short-term goal. But this puts you at risk to losing complete personal assets should misfortune strike.
b) Partnership firm. Is owned and operated or run by at least two or more than two individuals. In the case of a Partnership firm, as being laws are not as stringent as that involving Ltd. Company, (limited company) it relates to a involving trust within partners. But similar using a proprietorship thankfully risk of losing personal assets in any eventuality.
c) OPC Company Registration in India Online is a one Person Company in how the company is often a separate legal entity within turn effect protects the owner from being personally accountable for any obligations.
d) Limited Liability Partnership (LLP), from where the general partners have limited liability. LLP combines the very best of partnership firm and an organisation and the partners aren’t personally liable to lose their personal holdings.
e) Limited Company will be of 2 types,
i) Public Limited Company where the minimum number of members needed are 7 and there’s no upper limit; the connected with directors must be at least 3 and
ii) Private Limited Company where minimal number folks needed are 7 having a maximum maximum of 45. The number of directors must be 2.