Business registration procedure is quite simple and beneficial especially for the entrepreneurs in India. That may include any service provider, manufacturer, retailer or any other businesses that may fit and accomplish your dreams and desires.
There may be variance in additional procedures with some different business models, however, some basic and common requirements for registration business in India are mentioned below.
1) Obtain Digital Signature
2) Obtain director Identification Number (DIN)
3) Secure Your Company Name
4) Obtain Permanent Account Number
Starting a business needs to be registered legally. Choosing a right sort of company is extremely important. It helps you achieve the specified targets. tons of thought has got to be put in when selecting a structure like cost of registration, cost of compliance’s, tax rates etc.
Private Limited Company (PLC)
2 shareholders and directors are must to be minimum to resister a Private Limited Company in India. It’s ideal for fast growing companies and entrepreneurs getting to raise funds. Compliance cost is above LLP.
Govt. fees for Private Limited Company Rs.7800/-
Limited Liability Partnership ( LLP)
LLP registration is best fitted to family owned businesses. Raising funds is difficult in LLP. LLP can’t be converted privately Ltd.
Govt. fees for Limited Liability Partnership is Rs.3167/-
One Person Company ( OPC)
Only 1 founder/ owner is required to make a OPC. Investment can’t be raised in OPC. To switch from One Person Company to Private Ltd Company there are certain unavoidable conditions.
Govt. fees for One Person Company is Rs.6850/-
Proprietorship is the option to resister your company only if you are in trial period of your ideas together. It’s the only and cheapest boost to start a business. you can’t have partners in proprietorship.
Public Ltd. ( PPC)
It is ideal for giant corporations and corporations getting to list on stock market . the value of compliance is extremely high and minimum 7 shareholders/owners are required to register a Public Ltd.
Government Fees for various sorts of companies
One Person Company Rs.6850/-
Limited Liability Partnership Rs.3167/-
Private Ltd. Rs.7800/-
Director number (DIN)
Memorandum of Association (MOA)
Articles of Association (AOA)
Affidavit and declaration by first Subscribers and Directors.
Proof for Registered Office Address. Rental Agreement / Sale Deed.
Copies of a utility bill of the registered office address that aren’t older than 2 months.
If the proposed name may be a filed or registered trademark, then NOC from the trademark applicant or owner must be attached.
If the company is in growing period and want to raise funds then selecting Private Limited Company in India is the only better option to start with.
Advantages of Business Registration in India
Huge Market Potential
Beside having the second biggest populace on the planet, India is additionally the third biggest economy in Asia as far as GDP. Also, organizations may likewise profit by its various marked DTAAs and FTAs, offering access to significant customer markets including China and Australia.
Low Operation Cost
The expenses to set up and maintain a business in India are generally low contrasted with different nations, which means higher net benefit. Organizations can hope to profit by low settled up capital necessity, low normal compensation levels, and low power costs.
Attractive Government Initiatives
Organizations are qualified for liberal money related impetuses, for example, complete exception from corporate expenses.
Discounts of preparing cost, look into cost, or undertaking speculation.
Quickened deterioration on the estimation of types of gear and repayments of activity cost.
A company registration permits you to rent an employees and spend them in accordance to state laws. the corporate registration with in your state you’ll get a state number . It allows you to on state taxes, behalf of the workers . So, if you opt to rent an employee to your business, you want to incorporate your company registration with in your state.
Disadvantages of Business Resistration in India
Cultural difference in business
Indian government and its regulations bends towards the favor of the localized entrepreneurs rather than foreigners to setup the business in India.
Moreover, delays in any application process associated with business matters are common thanks to red tapes. As a result, it’s going to take months to only register a corporation in India.
Companies registered in India need to pay the charges in form of duty taxes around 2% up to 12%, and although Health & Education charges of 4% on top of the high corporate taxes in India.
Businesses can also be standing factor for this Dividend Distribution Tax (DDT), excluding the GST.
Registering and empowering business in India is quite problem facing for foreigners.
Foreign entrepreneurs are insecure about their savings or investments in their companies registered in India.
The overall tax paid by the companies to government in India ( including profit taxes ) are harshly as 60% high.
Registering and Licensing Time Involvement
It can take up to five months for only normal LLC company registration in India and open the company checking account , due to the quantity of paperwork involved and government approvals required.
Companies will got to work regularly with government authorities for matters concerning business approvals and licenses which may be very chaotic and not well organized.