There are several good some reasons why it makes ample sense to register your company. The first basic reason is to safeguard one’s own interests by no means risk personal assets to the stage that facing bankruptcy in case your business faces a crisis and and that is forced to close down. Secondly, it is much 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 company. (These are terms which have been described later on). Another valid reason is, from a limited company, if wishes to transfer their shares to another it’s easier when company is registered.
Very there’s always a dilemma as to when organization should be registered. The answer to which is, primarily, in case business idea is good enough to be converted to a profitable business or not. And if the answer to and also confident and also resounding yes, then then it’s time for in order to go ahead and register the startup. And as mentioned earlier on it is often beneficial to write it as a preventive measure, before important work saddled with liabilities.
Depending upon the size and type of the organization and the way you want to be expanded it, your startup could be registered as the many legal formats in the structure of a company accessible to you.
So ok, i’ll first educate you with needed information. The different company structures available are:
a) Sole Proprietorship. Would you company owned and operated or run by only individual. No registration it takes. This is the method to be able to if you should do it all by yourself and the objective of establishing vehicle is to realize a short-term goal. But this puts you at risk to losing your own personal assets should misfortune strike.
b) Partnership firm. Is owned and operated or run by at least two or maybe than two individuals. In the event of a Partnership firm, when your laws are not as stringent as that involving Ltd. Company, (limited company) it requires a regarding trust concerning the partners. But similar in order to some proprietorship answer to your problem risk of losing personal belongings in any eventuality.
c) OPC Registration Online in India is a single Person Company in how the company can be a separate legal entity within turn effect protects the owner from being personally accountable for any damages.
d) Limited Liability Partnership (LLP), while general partners have limited liability. LLP combines the best of partnership firm and a supplier and the partners are not personally prone to lose their personal wide range.
e) Limited Company which is of 2 types,
i) Public Limited Company where the minimum 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 minimal number persons needed are 7 along with a maximum upper limit of corporation. The number of directors must be 2.