There are some good main reasons why it makes ample sense to register your little. The first basic reason is preserve one’s own interests but not risk personal assets to the stage that facing bankruptcy in case your business faces a crisis and is also forced to close down. Secondly, it is easier to attract VC funding as VCs are assured of protection if organization is disclosed. It provides tax benefits to the entrepreneur typically in a partnership, an LLP potentially a limited group. (These are terms which have been described later on). Another valid reason is, in case of a limited company, 1 wishes to transfer their shares to another it’s easier when the company is subscribed.
Very almost always there is a dilemma as to when business should be registered. The solution to which is, primarily, in case business idea is sufficiently good to be converted into a profitable business or not solely. And if the answer to method has . confident too resounding yes, then it’s time for one to go ahead and register the start-up. And as mentioned earlier on it’s usually beneficial to write it as a preventive measure, before damaging saddled with liabilities.
Depending upon the type and size of the organization and the way you want to expand it, your startup can be registered among the many legal formats in the structure of a company accessible to you.
So i want to first fill you in with needed information. The different company structures available are:
a) Sole Proprietorship. Of the company managed or run by one particular individual. No registration is needed. This is the method to if you wish to do it yourself and the reason for establishing the organization is to realize a short-term goal. But this puts you at risk to losing all your personal assets should misfortune strike.
b) Partnership firm. Is owned and operated or run by at least two or more than two individuals. You should a Partnership firm, as laws aren’t as stringent as that involving Ltd. Company, (limited company) it relates to a associated with trust in between the partners. But similar to a proprietorship you will find a risk of losing personal assets in any eventuality.
c) OPC Company Registration in India Online is a one Person Company in that the company can be a separate legal entity which effect protects the owner from being personally subject to any losses.
d) Limited Liability Partnership (LLP), while general partners have limited liability. LLP combines the best of partnership firm and a supplier and the partners aren’t personally liable to lose their personal wealthiness.
e) Limited Company that of 2 types,
i) Public Limited Company where the minimum number of members needed are 7 and there’s really no upper limit; the quantity of directors must be at least 3 and
ii) Private Limited Company where the minimum number persons needed are 7 along with a maximum upper limit of fifty five. The number of directors must be 2.