There are a couple of good the actual reason why it makes ample sense to register your tiny. The first basic reason is to protect one’s own interests and is not risk personal assets to the aim of facing bankruptcy in case your business faces an emergency and also is forced to close down. Secondly, it is a lot easier to attract VC funding as VCs are assured of protection if an additional is registered. It provides tax benefits to the entrepreneur typically in a partnership, an LLP or even a limited firm. (These are terms which have been described later on). Another valid reason is, any time a limited company, if wishes managed their shares to another it’s easier when the company is subscribed.
Very often there is a dilemma as to when the corporate should be registered. The solution to which is, primarily, when the business idea is good enough to be converted to a profitable business or truly. And if the answer to that is a confident and a resounding yes, then it’s time for someone to go ahead and register the startup. And as mentioned earlier on it will be beneficial to write it as a preventive measure, before damaging saddled with liabilities.
Depending upon the size and type of the actual and a method to want to be expanded it, your startup could be registered among the many legal formats for this structure of a company accessible to you.
So allow me to first fill you in with necessary information. The different company structures available are:
a) Sole Proprietorship. It is a company owned and operated or run by only individual. No registration is actually required. This is the method to be able to if you wish to do it alone and the purpose of establishing business is gain a short-term goal. But this puts you prone to losing your entire 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 case of a Partnership firm, as the laws are not as stringent as that involving Ltd. Company, (limited company) it requires a associated with trust within partners. But similar using a proprietorship there is a risk of losing personal assets in any eventuality.
c) OPC Registration Online in India is single Person Company in that this company is really a separate legal entity which in effect protects the owner from being personally liable for any cutbacks.
d) Limited Liability Partnership (LLP), that the general partners have limited liability. LLP combines the best of partnership firm and an organisation and the partners aren’t personally liable to lose their personal power.
e) Limited Company which is of 2 types,
i) Public Limited Company where minimal number of members needed are 7 and there isn’t any upper limit; the regarding directors should be at least 3 and
ii) Private Limited Company where the minimum number of people needed are 7 using a maximum upper limit of 150. The number of directors must be 2.