There are several good reasons why it makes ample sense to register your company. The first basic reason is to guard one’s own interests by no means risk personal assets to the aim of facing bankruptcy in case your business faces an emergency and also is forced to seal down. Secondly, it is simpler to attract VC funding as VCs are assured of protection if the company is accredited. It provides tax benefits to the entrepreneur typically in a partnership, an LLP or maybe limited company. (These are terms which have been described later on). Another valid reason is, in case of a limited company, 1 wishes managed their shares to another it’s easier when company is registered.
Very almost always there is a dilemma as to when organization should be registered. The answer to which is, primarily, if your business idea is good enough to be converted to a profitable business or not solely. And if the answer to that is a confident too resounding yes, then it’s the perfect time for in order to go ahead and register the startup. And as mentioned earlier on it is always beneficial to do it as a preventive measure, before you could be saddled with liabilities.
Depending upon the type and size of the business and when there is want to be expanded it, your startup can be registered as one of the many legal formats in the structure on the company available to you.
So permit me to first educate you with necessary information. The various company structures available are:
a) Sole Proprietorship. Would you company owned and operated or run by one particular individual. No registration it takes. This is the method in order to if for you to do it all by yourself and the goal of establishing the company is gain a short-term goal. But this puts you liable to losing every personal assets should misfortune strike.
b) Partnership firm. Is owned and operated or run by at least two or more than two individuals. In the event of a Partnership firm, when your laws aren’t as stringent as that involving Ltd. Company, (limited company) it requires a involving trust concerning the partners. But similar the proprietorship there could risk of losing personal belongings in any eventuality.
c) OPC Company Registration in India Online is a one Person Company in that this company is a separate legal entity which usually effect protects the owner from being personally accountable for any damages.
d) Limited Liability Partnership (LLP), whereas the general partners have limited liability. LLP combines the best of partnership firm and an organisation and the partners are not personally prone to lose their personal power.
e) Limited Company that’s of 2 types,
i) Public Limited Company where the minimum number of members needed are 7 and there isn’t any upper limit; the number of directors must be at least 3 and
ii) Private Limited Company where minimal number folks needed are 7 with a maximum maximum of 150. The number of directors must be 2.