There are many good main reasons why it makes ample sense to register your specialist. The first basic reason is to guard one’s own interests but not risk personal assets to the stage that facing bankruptcy in case your business faces an emergency and and that is forced to shut down. Secondly, it is much simpler to attract VC funding as VCs are assured of protection if the company is accredited. It provides tax benefits to the entrepreneur typically in a partnership, an LLP or even a limited firm. (These are terms which have been described later on). Another valid reason is, in case of a limited company, 1 wishes to transfer their shares to another it’s easier when group is registered.
Very often there is a dilemma as to when the corporate should be registered. The solution to which is, primarily, if your business idea is good enough to be converted to a profitable business or never ever. And if the answer to and also confident too resounding yes, then it is time for in order to go ahead and register the start-up. And as mentioned earlier on it’s always beneficial to make it work as a preventive measure, before important work saddled with liabilities.
Depending upon the type and size of the business and like you would want to inflate it, your startup could be registered as one of the many legal formats belonging to the structure in a company open to you.
So let me first educate you with the required information. The various company structures available are:
a) Sole Proprietorship. It is a company managed or run by only individual. No registration is needed. This is the method to adopt if you wish to do it alone and the objective of establishing the company is to attain a short-term goal. But this puts you at risk to losing every 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, as laws are not as stringent as that involving Ltd. Company, (limited company) it requires a regarding trust concerning the partners. But similar together with proprietorship you will find a risk of losing personal belongings in any eventuality.
c) OPC Registration Online in India is a single Person Company in which the company is often a separate legal entity within turn effect protects the owner from being personally liable for any damages.
d) Limited Liability Partnership (LLP), whereas the general partners have limited liability. LLP combines the best of partnership firm and a corporation and the partners are not personally liable to lose their personal wealthiness.
e) Limited Company that’s of 2 types,
i) Public Limited Company where minimal number of members needed are 7 and there’s no upper limit; the regarding directors must be at least 3 and
ii) Private Limited Company where minimal number persons needed are 7 using a maximum upper limit of fifty five. The number of directors must be 2.