There are many good some reasons why it makes ample sense to register your little. The first basic reason is to guard one’s own interests and not risk personal assets to the point of facing bankruptcy in case your business faces an emergency and which forced to seal down. Secondly, it is easier to attract VC funding as VCs are assured of protection if firm is accredited. It provides tax benefits to the entrepreneur typically in a partnership, an LLP and even limited enterprise. (These are terms which have been described later on). Another valid reason is, from a limited company, if one wishes managed their shares to another it’s easier when group is authorized.
Very there’s always a dilemma as to when organization should be registered. The answer to which is, primarily, when your business idea is good enough to be converted into a profitable business or not solely. And if the answer to method has . confident and also resounding yes, then it is time for in order to go ahead and register the investment. And as mentioned earlier on it is always beneficial find a quote as a preventive measure, before you are saddled with liabilities.
Depending upon the size and type of the organization and the way you want to expand it, your startup could be registered as one of the many legal formats of the structure on the company on the market.
So allow me to first educate you with needed information. The various company structures available are:
a) Sole Proprietorship. Of your company managed or run by one particular individual. No registration it will take. This is the method to adopt if you should do it all by yourself and the purpose of establishing the company is obtain a short-term goal. But this puts you at risk of losing your own 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 a Partnership firm, just as the laws are not as stringent as that involving Ltd. Company, (limited company) it relates to a associated with trust concerning the partners. But similar in order to some proprietorship you will find a risk of losing personal belongings in any eventuality.
c) OPC is a One Person Company Registration in India online Person Company in that your company can be a separate legal entity which effect protects the owner from being personally subject to any obligations.
d) Limited Liability Partnership (LLP), while general partners have limited liability. LLP combines the very best of partnership firm and a company and the partners aren’t personally liable to lose their personal wealth.
e) Limited Company will be of 2 types,
i) Public Limited Company where minimal number of members needed are 7 and there is no upper limit; the connected with directors must be at least 3 and
ii) Private Limited Company where minimal number persons needed are 7 by using a maximum upper limit of 150. The number of directors must be 2.