There are many good good reason that it makes ample sense to register your little. The first basic reason is to safeguard one’s own interests but not risk personal assets to the stage that facing bankruptcy in case your business faces an emergency and which forced to close down. Secondly, it is simpler to attract VC funding as VCs are assured of protection if the company is registered. It provides tax benefits to the entrepreneur typically in a partnership, an LLP or maybe limited enterprise. (These are terms which have been described later on). Another valid reason is, in case of a limited company, if one wishes managed their shares to another it’s easier when an additional is authorized.
Very almost always there is a dilemma as to when the corporate should be registered. The answer 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 the confident too resounding yes, then then it’s time for one to go ahead and register the investment. And as mentioned earlier on it is always beneficial find a quote as a preventive measure, before important work saddled with liabilities.
Depending upon the size and type of the actual and like you would want to flourish it, your startup can be registered as the many legal formats with the structure in a company on the market.
So ok, i’ll first fill you in with necessary information. The various company structures available are:
a) Sole Proprietorship. Would you company managed or run by just One Person Company Registration in India online individual. No registration becomes necessary. This is the method to if you want to do it yourself and the reason for establishing the company is to realize a short-term goal. But this puts you prone to losing your entire personal assets should misfortune strike.
b) Partnership firm. Is owned and operated or run by at least two a lot more than two individuals. You should a Partnership firm, when your laws aren’t as stringent as that involving Ltd. Company, (limited company) it requires a regarding trust regarding the partners. But similar using a proprietorship answer to your problem risk of losing personal assets in any eventuality.
c) OPC is single Person Company in which the company can be a separate legal entity which in effect protects the owner from being personally responsible for any losses.
d) Limited Liability Partnership (LLP), whereas the general partners have limited liability. LLP combines the very best of partnership firm and a corporation and the partners are not personally liable to lose their personal wide range.
e) Limited Company that of 2 types,
i) Public Limited Company where the minimum number of members needed are 7 and there is no upper limit; the associated with directors should be at least 3 and
ii) Private Limited Company where minimal number of people needed are 7 having a maximum maximum of 50. The number of directors must be 2.