There are several good good reason that 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 also is forced to close down. Secondly, it is a lot easier to attract VC funding as VCs are assured of protection if this company is disclosed. It provides tax benefits to the entrepreneur typically in a partnership, an LLP or a limited enterprise. (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 enrolled.
Very almost always there is a dilemma as to when business should be registered. The answer to which is, primarily, when your business idea is sufficiently good to be converted into a profitable business or not. And if the answer to that is a confident properly resounding yes, then then it’s time for one to go ahead and register the new. And as mentioned earlier on it’s usually beneficial to make it work as a preventive measure, before you could be saddled with liabilities.
Depending upon the size and type of enterprise enterprise and the way you want to be expanded it, your startup can be registered as one of the many legal formats of the structure in a company available.
So permit me to first fill you in with necessary information. The different company structures available are:
a) Sole Proprietorship. Of your company managed or run by 1 individual. No registration it takes. This is the method in order to if you must do it alone and the reason for establishing vehicle is gain a short-term goal. But this puts you subject to losing your own personal assets should misfortune strike.
b) Partnership firm. Is owned and operated or run by at least two or even more than two individuals. You should a Partnership firm, just as the laws aren’t as stringent as that involving Ltd. Company, (limited company) it requires a lot of trust within partners. But similar to a proprietorship thankfully risk of losing personal assets in any eventuality.
c) OPC Registration Online in India is a 60 minute Person Company in that this company can be a separate legal entity which 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 best of partnership firm and a corporation and the partners aren’t personally liable to lose their personal wealth.
e) Limited Company that of 2 types,
i) Public Limited Company where the minimum number of members needed are 7 and there’s no upper limit; the quantity of directors should be at least 3 and
ii) Private Limited Company where minimal number of needed are 7 by using a maximum upper limit of fifty five. The number of directors must be 2.