Over the years, India has become one of the most preferable destinations for entrepreneurs and investors.
Are you starting a business in India? There’s nothing more exciting yet stressful than being your boss. While you start your entrepreneurial journey, you may know that every business in India is required to register itself as a part of legal compliance.
Are you looking for a Private Limited Company Registration in Delhi? With Ontaxco, you can have professional assistance for all your legal and accounting hassles.
Let’s have a look at how to register a company in India with a step-by-step process.
Step 1: Deciding the business structure –
Deciding the business structure will ensure how your company will work and handle operations in the future. Thus, it is crucial to decide on the right business structure catering to your business’s needs and wants.
Let’s take a brief look at the different types of business structures.
1. Private Limited Company – One of the most preferred business entities in India, a Private Limited Company requires a minimum of 2 shareholders and 2 directors.
2. Public Limited Company – A Public Limited Company should have a minimum of 7 members and 3 directors and there is no limitation on the maximum number of members or directors for a Public Company. The major difference between a Private Limited Company and a Public Limited company is that a public limited should have a minimum paid-up capital of 5 lakhs.
3. Partnership Firm – A Partnership Firm can have a maximum of 100 partners and a registered firm has to adhere to all the guidelines under the Indian Partnership Act. The profit and losses of a partnership firm are shared according to the partnership deed.
4. Limited Liability Partnership – As the name suggests, an LLP provides the benefit of limited liability wherein it is mandatory for an LLP to have a minimum of two partners. This also provides the freedom of structuring the internal management of the company based on a mutual agreement.
5. Sole Proprietorship – The company has only 1 person as the owner who owns all the assets and there are no legal formalities required to start this business except licensing and business registration.
6. One-Person Company – An OPC has only one member and can select one nominee. In case of the death of the original shareholder, this nominee becomes a shareholder.
Step 2: Apply for a Digital Signature Certificate (DSC) – A digital signature is a means to validate the authenticity and integrity of a digital document. It’s the digital equivalent of a physical signature or stamped seal, but it offers far more inherent security against impersonification. To obtain a DSC, companies should only contact agencies that have been appointed by the Controller of Certification Agencies (CCA).
Step 3- Filing for Name Approval – When you are planning to register a company, you must have a name for it, right? The name of your company should be unique and distinctive. To file for name approval for the above-mentioned business structures, use the Reserve Unique Name (RUN) form and keep in mind that this can only be used once. In case, your company’s name is clashing with an already existing company, your RUN form will be rejected and cannot be re-used.
Step 4: Obtain Director Identification Number (DIN) – A Director Identification Number is a unique 8-digit identification number issued under the Companies Act Section-153 to individuals planning to be the directors of a company.
Step 5: File for MoA and AoA –
Memorandum of Association (MoA)– This document contains every detail of the registering company with its purpose of incorporation. Once created, MoA cannot be amended.
Articles of Association (AoA)– This document specifies the rules and regulations laid out by the company. It is a user manual that provides details about the management, conduct, and bye-laws governing the internal affairs of the company. An AoA can be amended if required.
Step 6: File for Incorporation – The final step in the company registration procedure is filing for incorporation and the Ministry of Corporate Affairs has provided dedicated forms for incorporation of each business structure.
This is the comprehensive step-by-step procedure for registering a company in India. With this guide, we hope to have answered all your queries about company registration. If you still have any further questions, contact Ontaxco and we will guide you through the entire process.
