There are many good main reasons why it makes ample sense to register your tiny. The first basic reason is to guard one’s own interests but not risk personal assets to the aim of facing bankruptcy in case your business faces a crisis and is forced to shut down. Secondly, it is much simpler to attract VC funding as VCs are assured of protection if organization is disclosed. 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, any time a limited company, if One Person Company Registration in India online wishes to transfer their shares to another it’s easier when group is authorized.
Very almost always there is a dilemma as to when business should be registered. The solution to which is, primarily, when your business idea is sufficiently good to be converted to a profitable business or not too. And if the answer to that is a confident properly resounding yes, then it’s the perfect time for in order to go ahead and register the new. And as mentioned earlier on it will be beneficial to do it as a preventive measure, before damaging saddled with liabilities.
Depending upon the type and size of the organization and like you would want to be expanded it, your startup could be registered as one of the many legal formats in the structure of a company available.
So let me first educate you with the mandatory information. The different company structures available are:
a) Sole Proprietorship. That’s a company managed or run by one particular individual. No registration it will take. This is the method in order to if you must do it yourself and the purpose of establishing the company is to achieve a short-term goal. But this puts you at risk of losing all your personal assets should misfortune strike.
b) Partnership firm. Is owned and operated or run by at least two or maybe than two individuals. In the a Partnership firm, as laws are not as stringent as that involving Ltd. Company, (limited company) it demands a lot of trust concerning the partners. But similar to a proprietorship thankfully risk of losing personal assets in any eventuality.
c) OPC is a Person Company in that this company can be a separate legal entity within turn effect protects the owner from being personally liable for any cutbacks.
d) Limited Liability Partnership (LLP), while general partners have limited liability. LLP combines the best of partnership firm and a supplier and the partners aren’t personally liable to lose their personal wide range.
e) Limited Company that of 2 types,
i) Public Limited Company where minimal number of members needed are 7 and there isn’t any upper limit; the associated with directors should be at least 3 and
ii) Private Limited Company where the minimum number of needed are 7 with a maximum maximum of corporation. The number of directors must be 2.