Any Indian company is under the obligation to register itself under the legal compliance of the country. Further, this step marks the legal presence of this establishment. Thus, aiding to stand out as a legit company among defaulters in this overly inhabited nation. Additionally, before running a business in a market, the type and structure of the unit must be well thought of. Hence, it is important to understand the varieties of entities functional as of now in the nation.
To incorporate a company in India requires submitting:
- Simplified Proforma for Incorporating Company electronically (SPICe-INC-32). Click here to download the same
- Electronic Memorandum of Association (eMoA) under INC-33. Click here to download
- Electronic Articles of Association (eAOA) under (INC-34). Click here to download
This process is mandatory option and all new companies are required to be incorporated through Simplified Proforma for Incorporating Company electronically only.
How can Foreign companies establish a place of business in India?
For foreign companies to start a company in India they need to file eForm FC-1. This can be downloaded by clicking here
Digital Signature necessary to submit eForm by authorized signatory of the foreign company. For foreign companies no requirement for directors to apply and obtain DIN. However, Digital Signature Certificate (DSC) is mandatory to register a foreign company.
Choose the Right Type Business
It is necessary to pick the type of business as it affects the entire functionality of the company. Similarly, the income returns are dependent on the structure. For instance, a sole proprietorship files only an income tax return as opposed to filing both tax returns and annual returns. Additionally, the companies have to maintain a financial record that will undergo an audit once every year. Following that will cost the company, hence choosing the correct structure plays an important role in the functionality of the establishment abiding the guideline of The Companies Act, 2013.
The types of business units in India
As- stated earlier, the necessity to understand the structure of the entity is ample. Thereby, before stating the registration process of the company, glance through the types. Hence, the types are listed here-on:
- One owner company (OPC)– came to force in 2013, contains a sole proprietor. Consequently, the best way to establish a new company. Because, a single person carries the work out yet, at the same time is a fragment of the corporate context
- Limited Liability Partnership (LLP)- In such a distinct legal unit, partners make up the company. And, they are restricted to their respective contributions
- Private Limited Company (Pvt)- This type of lawful entity consists of trust members as stakeholders and directors. Thus, designating each person as an employee of the establishment
- Public Limited Company (Ltd)- This structure encourages voluntary connotation unified under the company law. Moreover, the unit is a separate legal entity and member’s accountability is restricted to their shares
Pointers to Choose the Right Structure of the Business
Things to consider while choosing the type of business:
- The number of people in the company
- Initial investment
- The inclination to tolerate the entire liability of the business
- Income tax returns
- Money from depositors
Necessary steps to be taken prior starting a business
- Acquire Director Identification Number (DIN)
- Attain Digital Signature Certificate (DSC)
- Select company name and reserve it online
- Submit SPICe INC-32, eMOA INC-33 and eAOA INC-34
- Stamp business documents
- Obtain Incorporation Certificate
- Create a seal for the company
- Get Permanent Account Number (PAN)
- Obtain Tax Account Number (TAN)
- Enroll under Office of Inspector and Establishment Act
- GST registration
- Register For state Profession Tax (Profession tax Office)
- Enroll under Employees Provident Fund Organization
- Get Medical Insurance
Documents required for the registration process of the company
- A formal letter from ROC (for accessibility company name)
- DIN
- DSC
- Form-1 (Incorporation of the company)
- Form-18 (Address of the company)
- Form-32 (Details regarding the directors, managers, and secretaries)
General Registration process of a Company
The registration is a simple 4 step process:
- Acquire the DSC form the authorized site
- Obtain DIN
- Go to MCA portal and create an account for new enrolment
- Apply for the registration
Registering an LLP
This structure is highly popular and liable, hence requires a list of documents. Such as DPIN, DSC, MCA registration, Fill Form 1 and 2 (for LLP incorporation), and Form 3 (Initial agreement). Besides that, the basic requirements like PAN, GST registration, Current account, and IEC code are applicable. Furthermore, Registration cum Membership certificate from Export Promotion council is an additional obligation
Registering a Private Limited Company
Initially, obtain DSC and DIN. Secondly, Select the name of the establishment. Further, drafting Memorandum and Articles of Association (MOA and AOA). Consequently, Stamp, Sign, e- fill several necessary documents. Next, pay a fee for ROC. Finally, obtain an incorporation certificate. Thus ready for registration and functioning of the company
Registering a Public Limited Company
This is similar to the Private limited company process. Besides the requirement of additional forms like DIR-12, INC-7, and INC-22. In addition, obtaining the certificate for commencement to start the business is mandatory.