There are a couple of good some reasons why it makes ample sense to register your tiny. The first basic reason is to protect one’s own interests and is not risk personal belongings to the stage that 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 the company is opted. It provides tax benefits to the entrepreneur typically in a partnership, an LLP potentially a limited company. (These are terms which have been described later on). Another valid reason is, just in case 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 the business idea is sufficiently good to be converted to a profitable business or not too. And if the answer to the confident properly resounding yes, then then it’s time for someone to go ahead and register the new. And as mentioned earlier on it will be beneficial to make it work as a preventive measure, before you are saddled with liabilities.
Depending upon the size and type of the actual and like you would want to inflate it, your startup can be registered as the many legal formats belonging to the structure of a company on the market.
So permit me to first fill you in with the mandatory information. The various company structures available are:
a) Sole Proprietorship. It is a company owned and operated or run by one particular individual. No registration it will take. This is the method to if you want to do it on your own and the purpose of establishing the company is obtain a short-term goal. But this puts you prone to losing complete personal assets should misfortune strike.
b) Partnership firm. Is owned and operated or run by at least two or maybe than two individuals. You should a Partnership firm, just as the laws are not as stringent as that involving Ltd. Company, (limited company) it demands a lot of trust in between the partners. But similar together with proprietorship answer to your problem risk of losing personal belongings in any eventuality.
c) Online OPC Registration in India is single Person Company in that the company is often a separate legal entity that effect protects the owner from being personally subject to any losses.
d) Limited Liability Partnership (LLP), while general partners have limited liability. LLP combines the very best of partnership firm and an organisation and the partners are not personally prone to lose their personal wide range.
e) Limited Company is actually of 2 types,
i) Public Limited Company where minimal number of members needed are 7 and there isn’t a upper limit; the quantity of directors must be at least 3 and
ii) Private Limited Company where minimal number of needed are 7 by using a maximum upper limit of 45. The number of directors must be 2.