There are a few good reasons why it makes ample sense to register your company. The first basic reason is preserve one’s own interests and is not risk personal belongings to the point of facing bankruptcy in case your business faces a crisis and and that is forced to close down. Secondly, it is simpler 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 enterprise. (These are terms which have been described later on). Another valid reason is, any time a limited company, 1 wishes managed their shares to another it’s easier when the company is authorized.
Very often there is a dilemma as to when the corporate should be registered. The answer to which is, primarily, as well as business idea is sufficiently good to be converted to a profitable business or never ever. And if the answer to the confident properly 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 do it as a preventive measure, before damaging saddled with liabilities.
Depending upon the size and type of the organization and a method to want to flourish it, your startup could be registered as one of the many legal formats in the structure in a company available to you.
So permit me to 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 is needed. This is the method to be able to if you should do it all by yourself and the goal of establishing business is to achieve 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 higher than two individuals. In the event of a Partnership firm, as the laws aren’t as stringent as that involving Ltd. Company, (limited company) it relates to a lot of trust within partners. But similar to a proprietorship thankfully risk of losing personal assets in any eventuality.
c) Online OPC Registration in India is a single Person Company in which the company can be a separate legal entity which effect protects the owner from being personally accountable for any loss.
d) Limited Liability Partnership (LLP), while general partners have limited liability. LLP combines the very best of partnership firm and a business and the partners are not personally prone to lose their personal wide range.
e) Limited Company that’s of 2 types,
i) Public Limited Company where the minimum number of members needed are 7 and there’s really no upper limit; the connected with directors must be at least 3 and
ii) Private Limited Company where minimal number folks needed are 7 having a maximum upper limit of 50. The number of directors must be 2.