There are many good some reasons why it makes ample sense to register your network. 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 is forced to close down. Secondly, it is much easier to attract VC funding as VCs are assured of protection if this company is opted. It provides tax benefits to the entrepreneur typically in a partnership, an LLP and even limited reputable company. (These are terms which have been described later on). Another valid reason is, any time a limited company, if one wishes managed their shares to another it’s easier when enterprise is subscribed.
Very there’s always a dilemma as to when the company should be registered. The solution to which is, primarily, as well as business idea is sufficiently good to be converted into a profitable business or not too. And if the answer to the confident and also resounding yes, then it is time for someone to go ahead and register the startup. And as mentioned earlier on it is often beneficial to make it work as a preventive measure, before you are saddled with liabilities.
Depending upon the size and type of corporation and when there is want to inflate it, your startup could be registered as one of the many legal formats in the structure of the company open to you.
So permit me to first educate you with the mandatory information. The different company structures available are:
a) Sole Proprietorship. Of your company managed or run by just One Person Company Registration in India online individual. No registration it takes. This is the method to adopt if for you to do it for yourself and the goal of establishing firm is to attain a short-term goal. But this puts you prone to losing every personal assets should misfortune strike.
b) Partnership firm. Is owned and operated or run by at least two or higher than two individuals. In the case of a Partnership firm, as laws aren’t as stringent as that involving Ltd. Company, (limited company) it requires a associated with trust concerning the partners. But similar using a proprietorship there is a risk of losing personal assets in any eventuality.
c) OPC is a single Person Company in which the company can be a separate legal entity within turn effect protects the owner from being personally liable for any cutbacks.
d) Limited Liability Partnership (LLP), where the general partners have limited liability. LLP combines the very best of partnership firm and a company and the partners aren’t personally prone to lose their personal holdings.
e) Limited Company is actually of 2 types,
i) Public Limited Company where minimal number of members needed are 7 and there isn’t any upper limit; the associated with directors should be at least 3 and
ii) Private Limited Company where the minimum number of folks that needed are 7 using a maximum upper limit of corporation. The number of directors must be 2.