There are some good some reasons why it makes ample sense to register your little. The first basic reason is preserve one’s own interests and not risk personal assets to the purpose of facing bankruptcy in case your business faces a crisis and 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 disclosed. It provides tax benefits to the entrepreneur typically in a partnership, an LLP or a limited group. (These are terms which have been described later on). Another valid reason is, just in case a limited company, if one wishes to transfer their shares to another it’s easier when group is recorded.
Very almost always there is a dilemma as to when the corporate should be registered. The answer to which is, primarily, if your business idea is good enough to be converted into a profitable business or not too. And if the answer to and also confident too resounding yes, then it is time for someone to go ahead and register the start-up. And as mentioned earlier on it will be beneficial to create it happen as a preventive measure, before you are saddled with liabilities.
Depending upon the type and size of the organization and the way you want to expand it, your startup could be registered among the many legal formats belonging to the structure in a company available to you.
So ok, i’ll first fill you in with necessary information. The various company structures available are:
a) Sole Proprietorship. Would you company owned and operated or run by 1 individual. No registration becomes necessary. This is the method in order to if you wish to do it alone and the purpose of establishing business is to attain a short-term goal. But this puts you subject to losing complete personal assets should misfortune strike.
b) Partnership firm. Is owned and operated or run by at least two or more than two individuals. In the case of a Partnership firm, when your laws are not as stringent as that involving Ltd. Company, (limited company) it relates to a associated with trust between the partners. But similar using a proprietorship you will find a risk of losing personal belongings in any eventuality.
c) Online OPC Registration in India is a Person Company in that this company is a separate legal entity within turn effect protects the owner from being personally liable for any obligations.
d) Limited Liability Partnership (LLP), where the general partners have limited liability. LLP combines the very best of partnership firm and an organisation and the partners are not personally liable to lose their personal power.
e) Limited Company that’s 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 end up being at least 3 and
ii) Private Limited Company where the minimum number persons needed are 7 along with a maximum upper limit of 50. The number of directors must be 2.