Choosing the right company structure for your business. The right business structure will allow your enterprise to operate efficiently and meet your required business targets. In India, every business must register itself as part of mandatory legal compliance. Before we learn how to register a company, let’s try and understand the types of business structures in India.
What are the types of business structures in India?
One Person Company (OPC)
Recently introduced in the year 2013, an OPC is the best way to start a company if there exists only one promoter or owner. It enables a sole proprietor to carry on his work and still be part of the corporate framework.
Limited Liability Partnership (LLP)
An LLP is a separate legal entity where the liabilities of partners are only limited only to their agreed contribution. An LLP is established under the Limited Liability Act, 2008 with the Registrar of Companies (ROC).
Private Limited Company (PLC)
A PLC in the eyes of the law is regarded as a separate legal entity from its founders It has shareholders (stakeholders) and directors (company officers). Each individual is regarded as an employee of the company.
Public Limited Company
A Public Limited Company is a voluntary association of members that is incorporated under company law. It has a separate legal existence and the liability of its members is limited to the shares they hold.
You can choose what business structure suits your business needs best and accordingly register your business.
Other forms of business structures include Sole proprietorship, Hindu Undivided Family, and Partnership firms. Please bear in mind, that these structures do not come under the ambit of company law.
How to Register a Company in India?
Registering a company in India is now a simple 4-step process:
Step 1: Digital Signature Certificate (DSC)
Step 2: Director Identification Number (DIN)
Step 3: Registration on the MCA Portal
Step 4: Certificate of Incorporation
Documents Required for Company Registration
The general documents that are to be submitted for registration of LLP, One Person Company, Private Limited, and Public Limited Company are as follows:
Documents of the Directors and Shareholders of the Company/ Partners of the LLP
Proof of identification of all the company’s directors and shareholders (partners in case of LLP). Any one of the below documents can be submitted as proof of identification:
Pan card
Aadhar card
Driving license
Passport
Proof of address of all the directors and shareholders (partners in case of LLP). Any one of the below documents can be submitted as address proof:
Latest telephone bill (not older than 2 months)
Latest electricity bill (not older than 2 months)
Bank account statement having an address
DIN (DPIN in case of LLP) and DSC of all the directors (partners in case of LLP)
Documents of the Company/LLP
Proof of registered office of the company. The below documents must be submitted as address proof of the company:
Tenancy/rental agreement between the landlord and company/LLP
Letter or NOC from the landlord of his/her permission to use the office/premises as the LLP’s/company’s registered office.
Sale deed of the company/LLP office premises in the name of the company/LLP
The Memorandum of Association (MoA) contains the objects of the company for which the company is going to be incorporated and the liability of the members of the company.
The Articles of the Association (AoA) lays down the by-laws on which the company will operate.
For more details about documents required for incorporating a Person Company, read our article on documents required for one-person company registration.
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