In India, an entrepreneur can start his business in one of seven different types of companies and use the registration process in many ways. Every way needs registration with Indian government authorities. This registration has a unique importance in the Indian economy, and it opens a gateway to many opportunities for individuals and groups of people. In the Republic of India, there are seven types of companies and registrations.
If you wish to start any business in India legitimately, the sky’s the limit. In the recent past, India has developed a progressive business culture in a very strategic way. Your company can be from any sector or segment, and you can take advantage of numerous opportunities anywhere in India. After your valuable decision, you need to register your company or business with Indian ascendant entities. You must have a business entity registered. Such business entity registration will allow you to select the business owners, taxation, compliance, and benefits.
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How to understand the various types of company registration in India?
Today, the need of the hour is that any small or big business should register licitly under the Companies Act of 2013. In the Republic of India, there are seven different categories of business registration. Due to several alternatives, it can be inundating to select the right kind of company registration. However, we have a detailed list of company registrations and their application processes to make your company registration process effortless.
In India, there are seven different types of company registration:
- Sole Proprietorship
- One-Man or person Company
- Partnerships organizations
- A Limited Liability Partnership company.
- A private limited entity
- Limited Liability organization
- Section 8: Business (like NGOs)
Sole Proprietorship
We understand that a sole proprietorship registration is a company where a single entity manages the business. We treat the firm and its operator as a single entity. Similarly, earnings and liabilities become the responsibility of the owner or operator. As the names appear on the sole proprietorship registration, they will also appear on ITR Filing, GST Registration, and accounting, resulting in corporate liability. Almost all single-proprietorship enterprises hold the owner fully responsible for all profits and hazards. A sole proprietorship is a one-person firm that is relatively simple to establish. This form of registration is used by those who work from home or manage enterprises.
One-Man or Person Company
A single individual must serve as a director in one-person company registration. In other words, the single individual will be the director and a member or shareholder. It is similar to a sole proprietorship. The working pattern of one-person company registration can reduce shareholders’ liabilities and responsibilities to a certain extent. A one-person company is a corporation or business entity whose directors and members are the same. Only a single individual manages the activities, and the owner is responsible for work and any personal duties.
Partnerships organizations
Two or more partners who have already determined their role and profit-sharing can enter into a partnership and conduct business activities. For a Partnership Firm Registration, you need to use a binding agreement referred to as the Partnership Deed. You can specify duties, commitments, responsibilities, and the number of shares owned under business registration.
A Limited Liability Partnership company.
LLP means Limited Liability Partnership. We understand the LLP registration process is similar to that of partnership firm registration. But, it offers you limited liability. Simply put, your assets are more independent of the strengths of the LLP firm. As a result, your investments are safe. It is also known as the corporate form of a partnership business. The partners are accountable in proportion to their initial capital commitment, and hence one partner is not liable for the faults of the other partners.
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Private Limited Company Registration
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Private limited company registration is a perfect option for businesses that need to establish private organization companies. To safeguard their investment, a group of shareholders spreads the liabilities among themselves in this form of corporation. Shares in such a company cannot be traded or distributed publicly. The advantages of private limited company registration are vital because investors and banks prefer this registration, and it exists even if the directors change.
Public Limited Company Registration
Public limited company registration is identical to private limited company registration. The sole distinction is that the company’s shares can perform trading activities on the stock exchange. Therefore, it allows the transfer of shares from one member to another.
Also Read: MSME Registration – Small Business & SSI Application Online In India
Section 8: Company Registration (like NGOs)
Non-Profit Groups, or NGOs, are the most frequent titles for these charity organizations. The primary aims of these groups are social in nature, promoting the arts, sciences, learning, climate change, and assisting people in need. An NGO must have at least two owners and directors for registration purposes.
What credentials do you need to establish the types of companies and registrations?
Please find a list of all paperwork or records necessary for 7 different types of Indian business registrations below.
- An Aadhar Card, a PAN Card, registered office proof, and bank account information are necessary for singular proprietorship registration with Indian officials.
- One-man or one-person company registration will need ID proof, address proof of the company and rent agreement.
- A PAN card and address verification of partners and firms, a Partnership Contract, GST registration, and bank account details usually apply for Partnership Company Registration.
- For LLP firm establishment, authentic address evidence of office and partners, DSC, and ID proof of partners is necessary.
- All directors and shareholders must have a Pan and Aadhar Card, their addresses and PAN cards, their DIN, DSC, Utility Bill, NOC from a landlord, MOA, and Articles of Association.
- You’ll need documentation like a trustworthy address, evidence of office and partners, a DSC, and proof of partners’ ID to form a limited liability corporation.
- Section 8 companies, such as NGOs, must have a Digital Signature Certificate, DPIN/DIN, MOA, AOA, ID Verification Proof, Passport Size Photographs, Directors Data, and Address Verification Document.
Aadhar Cards, PAN Cards, registered address or office proof, bank account details, and photographs are frequent among the seven categories of business registration.
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