Details is a popular option to start a business in India by startups and businesses with higher growth aspirations. Pvt Ltd company is incorporated under the Companies Act of 2013, and governed by the Ministry of Corporate Affairs (MCA). It is a registered corporate structure, that provides business a separate legal identity from its owners. Hence, providing key advantages like the ability to contract in its own name, and safeguard personal assets of the owners from business liabilities.
Pvt Ltd Details and LLP both are limited liability structures. However, companies offer certain key advantages, especially for start-up’s. Ownership of the company is defined by share capital, which is easy to transfer compared to ownership transfer in LLP. Also, it clearly differentiates management and ownership. Hence, it is preferred by VCs, angel investors and banks for providing debt or equity funding.
However, one should also consider higher compliance and mandatory audit requirement, making it an expensive structure to maintain.
The process of company registration in India is revamped by MCA, effective from 26th January 2018. Now, registration of the company can be completed within 10-15 business days. arjlegal.in employs qualified company secretaries and chartered accountants, who ensure highest customer satisfaction and timely delivery of service. Entire process is managed online, with regular communication and assistance available throughout. We have clients in all major cities of India including Mumbai, Delhi, Bangalore, Pune, Ahmedabad, Hyderabad and more. And, Our services have equally relevant reach within smaller cities and towns in the country.
Pvt. Ltd. Details registration process is stringent enough to make this structure credible among others which makes fundraising or borrowing from external sources easier. The organization itself provides a number of ways to raise funds in the form of private equity, ESOP, and more.
Once the Details registration in India is done, a legal entity is born in eyes of law. This separates itself from its owners and managers. The company can operate on its own name simply by opening a bank account to own assets and enter into contract with parties. This also provides right to sue third parties in case of any defaults.
The company’s obligation or debts of does not create a charge over the owner’s personal assets. Their liability stays limited only to the capital subscribed and unpaid by them.
The separate ownership and management help both – the company and the management to focus on their potential works. The shareholders assign responsibility to operate and run the company without losing control in the form of voting.
For Private Details registration in India, following requirements must be fulfilled:
1. Minimum 2 directors shall be appointed, out of which one must be a resident of India.
2. Minimum 2 shareholders are required for this registration. Here, an individual may become shareholder and director at the same time.
3. A place of business in India must be provided as a registered office address.
During the registration, a minimum of INR 1 Lakh should be provided as an authorized capital. A minimum paid-up capital requirement is eliminated as a part of Government’s initiative to simplify the business registration in India. However, each shareholder must subscribe at least 1 share for the registration to introduce the sufficient amount for running the business.
The name of a company should be formulated as mentioned above. The applicants can provide the maximum of 2 names with their preference order under RUN form. The applicant should comply with the provisions of the Act or regulations. The registrar may ask to re-submit the application with a different name if names do not fall under the criteria of uniqueness, relevancy or do not fulfill other requirements.
Digital Signature Certificate is provided in the form of a token issued by Certified Authorities. Any form filed for online company registration in India shall be submitted after affixing the DSC of an Applicant. Also, the directors will require DSC for DIN application and the subscribers to MOA shall possess DSC for submitting e-forms for incorporation.
Authorised capital shows the maximum amount of capital that a company can raise by way of issue of shares at present or in the future. Whereas, the Paid-up Capital refers to the actual amount raised by a company i.e.; amount paid by the shareholders on the issuance of shares. One can register a company in India by any amount of paid-up capital which can be less or equal to the authorized capital but not exceeding the authorized capital.
Yes, a Private Details can carry multiple businesses if it is mentioned in the company’s MoA and approved by a registrar. The company can mention more than one business operating within the same field or of the same nature. Activities which are unrelated, such as fashion designing and event management or construction, those cannot be registered under the same company.
Yes, it is possible to register a Private Details at a commercial or residential place by providing the sufficient proof. A registered office is a place where the business receives communication, if any, from the MCA or any concerned authorities. This address is displayed at the portal of Ministry as well.
Yes, NRIs or foreigners can hold shares subject to FDI guidelines. However, a foreign participation above 50% will place the company under the category of Foreign Details.
No, none of the promoters are required to be present when opted to register a company online. All the forms are filed on the web portal and are digitally signed. Also, the required documents can be sent through e-mail or uploaded on our portal for filing.
Once, the company is registered, it should follow below-mentioned requirements on priority:
During every financial year, the company must hold one Annual General Meeting (AGM) and at least 4 board meetings (one in each quarter). Further, the accounts and financial statements must be audited by an independent auditor. Subsequently, it shall file form AOC – 4 and MGT – 7 as part of Annual Compliance within given time.
|Business Structure||Tax Rate||Effective Tax rate|
|Not availing any exemptions or incentives||22%||25.17%|
|Domestic Details:||(Base Rate)||(Base rate + surcharge + CESS)|
|Manufacturing companies incorporated after 01st October,2019 and not availing any incentives or exemptions||15%||17.16%|
|Availing any exemptions or incentives- turnover up to 400/- crore during FY 2017-18||25%||25%+ surcharge +4% CESS (*Surcharge varies as per the income tax slab)|
|In any other case||30%||30%+ surcharge +4% CESS (*Surcharge varies as per the income tax slab)|
Daily transactions of the business are recorded in the Books of Accounts of the Details by the Accountant/s. The Accounts hence recorded are verified by an Independent Auditor to make sure that no statutory compliance are missed and provide an Audit Report for the same.
(Note: arjlegal.in shall only take the accountability of the Accounting Service provided by them but however shall help in appointment of Independent Auditor for your business.)