There are many good some reasons why it makes ample sense to register your little. The first basic reason is to safeguard one's own interests and is not risk personal assets to the aim of facing bankruptcy in case your business faces a crisis and also is forced to seal down. Secondly, it is easier to attract VC funding as VCs are assured of protection if organization is disclosed. It provides tax benefits to the entrepreneur typically in a partnership, an LLP or maybe limited company. (These are terms which have been described later on). Another valid reason is, from a limited company, 1 wishes to transfer their shares to another it's easier when enterprise is recorded.
Very often there is a dilemma as to when business should be registered. The solution to which is, primarily, if your business idea is sufficiently good to be converted to a profitable business or truly. And if the answer to that is a confident and a resounding yes, then it's the perfect time for in order to go ahead and register the investment. And as mentioned earlier on it is often beneficial to do it as a preventive measure, before damaging saddled with liabilities.
Depending upon the size and type of the organization and the way you want to grow it, your startup can be registered among the many legal formats for this structure of the company available.
So permit me to first fill you in with the mandatory information. The different company structures available are:
a) Sole Proprietorship. Of the company owned and operated or run by only 1 individual. No registration it takes. This is the method to if you must do it alone and the goal of establishing the organization is gain a short-term goal. But this puts you subject to losing all your personal assets should misfortune strike.
b) Partnership firm. Is owned and operated or run by at least two or maybe than two individuals. For a Partnership firm, as the laws aren't as stringent as that involving Ltd. Company, (limited company) it requires a lot of trust within partners. But similar using a proprietorship answer to your problem risk of losing personal assets in any eventuality.
c) OPC Registration Online in India is a one Person Company in that your company is really a separate legal entity which in effect protects the owner from being personally responsible for any losses.
d) Limited Liability Partnership (LLP), where the general partners have limited liability. LLP combines the best of partnership firm and a supplier and the partners aren't personally liable to lose their personal wealthiness.
e) Limited Company which is of 2 types,
i) Public Limited Company where minimal number of members needed are 7 and there's really no upper limit; the connected with directors end up being at least 3 and
ii) Private Limited Company where minimal number persons needed are 7 by using a maximum maximum of 45. The number of directors must be 2.