There are some good main reasons why it makes ample sense to register your little. The first basic reason is to safeguard one’s own interests by no means risk personal belongings to the stage that facing bankruptcy in case your business faces a crisis and also is forced to shut down. Secondly, it is simpler to attract VC funding as VCs are assured of protection if this company is subscribed. It provides tax benefits to the entrepreneur typically in a partnership, an LLP or maybe limited group. (These are terms which have been described later on). Another valid reason is, any time a limited company, 1 wishes to transfer their shares to another it’s easier when the company is subscribed.
Very often there is a dilemma as to when business should be registered. The answer to which is, primarily, when the business idea is sufficiently good to be converted into a profitable business or not too. And if the answer to the confident which has a resounding yes, then it is time for someone to go ahead and register the investment. 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 the way you want to be expanded it, your startup could be registered as the many legal formats of the structure associated with company available.
So i want to first educate you with the mandatory information. The different company structures available are:
a) Sole Proprietorship. Of the company owned and operated or run by only 1 individual. No registration it will take. This is the method to adopt if you should do it on your own and the purpose of establishing the company is obtain a short-term goal. But this puts you liable to losing your own 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 relates to a lot of trust concerning the partners. But similar to a proprietorship you will find a risk of losing personal belongings in any eventuality.
c) Online OPC Registration in India is a Person Company in that your company is a separate legal entity which in effect protects the owner from being personally accountable 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 company and the partners are not personally liable 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 a upper limit; the number of directors end up being at least 3 and
ii) Private Limited Company where minimal number folks needed are 7 having a maximum upper limit of 150. The number of directors must be 2.