Private Limited Company registration is the most popular legal structure option for businesses in India. Private limited company can have a minimum of two members and a maximum of fifty members. The directors of a private limited company have limited liability to creditors. In a case of default, banks / creditors can only sell company’s assets but not personal assets of directors.
Start-ups and growing companies prefer private limited company as it allows outside funding to be raised easily, limits the liabilities of its shareholders and enables them to offer employee stock options to pull in top talent.
First of all, the partners have to apply for Digital signature and DPIN. Digital signature is an online signature used for filing and DPIN refer to Directors PIN number issued by MCA. If the directors already have DSC and DPIN, then this step can be skipped.
You need to provide 3 different options for your company name to MCA of which one will be selected. Names provided should ideally be unique and suggestive of company business
Once name is approved, one needs to draft Memorandum of association and Articles of Associate. Both MOA and AOA are filed with the MCA with the subscription statement.
It typically takes 15- 25 days to form a Private limited company and get the incorporation certificate. Incorporation certification is a proof that company has been created. It also includes your CIN number.
Then you need to apply for PAN and TAN. PAN and TAN are received in 7 working days. Post this, you can submit the Incorporation certificate, MOA, AOA and PAN with a bank to open your bank account.
LLP refers to Limited liability partnership and is governed by Limited Liability Partnership Act 2008. Limited Liability partnership is a business entity which provides an advantage of limited liability to its owners and at the same time requires minimal maintenance. The directors of a private limited company have limited liability to creditors. In the case of default, banks / creditors can only sell company’s assets and not personal assets of directors.
LLP is a separate legal entity that gives the benefit of limited liability of company plus the flexibility of a partnership, wherein no partner is held liable on account of other’s partner misconduct. An LLP agreement is drafted to govern their rights and duties. Limited Liability Partnership has been introduced in India by way of Limited Liability Partnership Act, 2008. Limited Liability Partnership is basically introduced to provide an opportunity to entrepreneurs where they can form of business organisation which is simple to maintain while at the same time providing limited liability to the owners.
Business Formation, Routine Compliances, Financial, Secretarial, Direct & Indirect Taxation