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How to register a company in India?

After completing all the initial steps for starting a company, it is time to get your company registered. It is mandatory for every company or business in India to get itself registered as a part of legal compliance.

Photo by Ashwini Chaudhary(Monty) / Unsplash

There are four types of companies that come under the ambit of company law, namely,

  • Limited Liability Partnership
  • One Person Company
  • Private Limited Company
  • Public Limited Company

Each type of proprietorship has its own set of pros and cons. As a founder, the company's purpose should be clear to you, which is one of the factors responsible for following a particular company structure.

1. Limited Liability Partnership

An LLP or Limited Liability Partnership (1) is a partnership in which two to n number of partners have limited liabilities from the company.

An LLP or Limited Liability Partnership is a separate legal entity in which the partners are only liable for their agreed contribution.

A Limited Liability Partnership is

  • Ideal for Service-oriented businesses or businesses that have low investment needs.
  • Tax Benefits- On depreciation.
  • Termination- Cannot be terminated on the partner's death or insolvency of limited partners. Entirely governed by LLP Act 2008.
  • Legal Compliances- Business tax returns & Registrar of Companies (ROC) to be filed.
  • Members- 2 to unlimited

2. One Person Company

One Person Company (2) is a part of the sole proprietorship paradigm that allows the founder to work solely on his business and still be a part of a corporate framework.

The concept of One Person Company was introduced recently in the Companies Act 2013 (3).

One Person Company is,

  • Ideal for Solo business owners looking for limited liability.
  • Tax Benefits- Tax-free for three years under the Startup India Scheme; no tax on dividend distribution and benefits on depreciation
  • Termination- Company, and owners hold separate entities and cannot end with the owner's death.
  • Legal Compliances- Business tax returns & Registrar of Companies (ROC) to be filed.
  • Members- 1

3. Private Limited Company

A Private Limited Company, holding private ownership, ideally comprises of members ranging from 2-200.

It is limited to the number of shares that are held by the members of a Private Limited Company, which cannot be traded publicly. The number of shareholders in a PLC cannot exceed a fixed figure (4).

A Private Limited Company is,

  • Ideal for Businesses has a high turnover.
  • Tax Benefits- Tax-free for three years under the Startup India Scheme and benefits on depreciation.
  • Legal Compliances- Business tax returns & Registrar of Companies (ROC) are to be filed along with a yearly audit.
  • Members- 2 to 200

4. Public Limited Company

A Public Limited Company (5) is a government-held body that has its shares offered to the general public and has limited liability.

A Public Limited Company is a separate legal entity whose shares can be traded openly with public or private investors.

A Public Limited Company is,

  • Ideal for Businesses having a high turnover.
  • Legal Compliances- Business tax returns to be filed along with mandatory audits.
  • Members- 7 to unlimited

How to Register Your Company in India

Required Documents Checklist-->

  • Original formal letter issued by Registrar of Companies concerning the availability of Company name
  • Director Identification Number of directors of a company
  • DSC - Digital Signature Certificate
  • 'Form 1' for the incorporation of a company
  • 'Form 18' for the situation/address of the company
  • 'Form 32' for details of proposed directors, managers, and secretary

Check out this presentation:

Step 1 - Obtain Director Identification Number (DIN)

A Director Identification Number can be obtained by filling out the application for DIN-1 available online.

It is a non-perishable 8-digit number assigned to the Director (s) of the company.

The application form for DIN can be filed on the Ministry of Corporate Affairs website (6).

Documents Required for DIN-->

  • Proof of address- Passport, Driving License, Voters ID Card, Provident Fund Statement, Bank Statement attested by banker, School Leaving Certificate, SSC / HSC / Graduation / Post-graduation Degree Certificate, Birth Certificate, Electricity Bill, Telephone / Mobile Bill, Gas Bill, Water Bill or Property Tax Receipt.
  • Proof of Identity- PAN Card or Passport

Step 2 - Acquire Digital Signature Certificate (DSC)

A Digital Signature Certificate can be obtained by filling out the form from one of the nine Certifying Authorities (CA) that have been granted a license to issue a DSC under Section 24 of the Indian IT Act 2000.

You can obtain your Digital Signature Certificate from the listed authorities on the Ministry of Corporate Affairs' website (7).

Documents Required for DSC-->

  • Photo ID Proof- Passport, Pan Card, Driving License, Post Office ID card, Photo ID card issued by the Ministry of Home Affairs, Bank Account Passbook with a photograph attached and signed by the individual with attestation by the concerned Bank official or any Government-issued photo ID card bearing the signatures of the individual.
  • Address Proof- AADHAAR Card, Voter ID Card, Driving Licence, Water Bill (<3 months), Electricity Bill (<3 months), Recent Bank Statements (<3 months), Service/VAT/Sales Tax registration certificate or Property Tax/ Corporation/ Municipal Corporation Receipt.

Step 3 - Create an Account on MCA Portal

Once you obtain the DIN & DSC for your company, you need to create a registered user account on MCA Portal for further advancements in registering your company (8).

Step 4 - Reserve Unique Name (RUN)

An applicant must get his company name reserved online on the MCA site.

Assistance from CA (Chartered Accountant) and CS (Company Secretariate) can also be taken to Reserve Unique Name (9) for your company.

The proposed company names must be unique, not offensive, and hold a phrase that can be misinterpreted and linked to a government body.

Requirements for RUN-->

  • Corporate Identification Number
  • Proposed Name
  • Documents required with the proposed name
  • An MCA account

Step 5 - Obtain the Certificate of Incorporation (COI)

With this step, you're almost done with registering your company.

Apply for your Certificate of Incorporation by filling out the approved company name, company address, details about company directors, managers, & secretary, and any relevant additional information.

Forms Required for Certificate of Incorporation-->

  • Form-1: Contains info about the company name & declaration of incorporation of the company
  • Form-18: Confirmed company's registered office address
  • Form-32: Form to appoint new directors, managers, secretary

All the eForms (10) must be submitted with the digital signature, requisite filing and registration fees must be paid, and a physical copy of the Memorandum and Article of Association must be sent to the RoC.

Once submitted, the MCA will review and approve all the forms. Further information and updates will be dropped via email.

Post-Registration Process:

Step 6 - Make a Seal

Once you register your company with the State, you can design and purchase your company seal.

Though making a company seal under the Company laws is not mandatory, one can always make one if required by your articles of association.

A company seal can be obtained from a seal maker or office supply store. It acts as the official signature of the company.

Usually, a company seal contains-->

  • Name of Company
  • Date of Incorporation
  • State under which the company was registered
  • Corporate symbol

Step 7 - Obtain Permanent Account Number (PAN)

To obtain a Permanent Account Number for the company, one needs to fill out the 49-A form on the NDSL website (11).

Documents Requirements for PAN for Company-->

  • Copy of Certificate of Incorporation
  • Copy of No Objection Certificate issued by the Ministry of Corporate Affairs.

Step 8 - Obtain Tax Account Number (TAN)

A TAN is a number that is issued to individuals required to deduct or collect tax on payments executed by them under the Indian Income Tax Act 1961 (12).

One can apply for TAN online or offline. For the offline method, you can download Form 49-B from the NSDL TIN website (13) and submit the filled-up documents at any of the TIN Facilitation Centres meant for receipt of e-TDS returns.

Step 9 - Register with the Office of Inspector, Shops and Establishment Act

All the corporates must register with the Office of Inspector & Shops and Establishment Act with a statement comprising information about all the employees and the establishment's name, postal address, and category.

All the details must be sent to the local shop inspector and the applicable fees. The establishment Registration Certificate is awarded within 30 days of receipt of the complete application.

Every state has its State and Establishment Act.

The Regulated aspects by Shop and Establishment Act-->

  • Opening and closing hours
  • Close days
  • Weekly holidays
  • Wages for holidays
  • Hours of work
  • Interval for rest and meals
  • Prohibition of employment of children
  • Employment of young people or women, etc.

Step 10 - File for GST

Any company or business holding a turnover of over Rs 40 lakhs, except Rs. 10 Lakhs for North-Eastern States, J&K, Himachal Pradesh, and Uttarakhand, is required to register for GST.

You can register for GST by heading to the site (14).

Document Requirement for GST-->

  • PAN of the Applicant
  • Aadhaar card
  • Certificate of Incorporation
  • Identity proof and Address proof of Director(s) with Photographs
  • Address proof of the company
  • Bank Account statement or canceled cheque
  • Digital Signature
  • Letter of Authorization/Board Resolution for Authorized Signatory

Bonus Options:

Once you complete all the legal formalities for your company, you can turn your head towards these utterly essential steps.

Step 11 - Design a Website

In today's digital time, any company that does not own a professional website is often misinterpreted as inefficient.

You can get your company's website designed by experts to outshine your competitors.

Some sites that help you develop your website are-->

  • DinosoftLabs (15)

Step 12 - Register Under Startup India

If your company is a startup, we have some great news for you!

By registering under the Startup India Scheme introduced by PM Narendra Modi, you can avail of a tax holiday for your firm for up to 3 years.

You can read our complete guide about startups in India by clicking here.

Step 13 - Register on Online Platforms

The IT sector in India is the key contributor to India's economy. In FY'19, the IT industry of India solely generated $180 billion.

If your company provides IT services to its clients, you can register on online platforms to expand your IT network.

Some IT online platforms are-->

  • Applancer (16)
  • Read the full list here.

The entire act of registering a company can either be performed with the assistance of CA & CS or done manually by a company online. Registering a company looks like a complicated task, but, as you can see, we've concluded the same into 13 steps for you with every little detail included.

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