Private Limited Company Registration

PRIVATE LIMITED COMPANY

 Description: A private limited company can be a small or large business. A private limited company has limited liability and often these types of business have ‘Ltd’ after the business name. An example of this would be ‘XYZ Ltd’.

Benefits of private ltd Company:

• No Minimum Capital: No minimum capital is required to form a Private Limited Company. A Private Limited Company can be registered with a mere sum of Rs. 10,000 as total Authorized Share capital.
• Separate Legal Entity: A Private Limited Company is a separate legal identity in the court of the law, meaning assets and liabilities of the business are not the same as the assets and liabilities of the Directors. Both are counted as different. A Private Limited Company Separates Management and Ownership and thus, managers are responsible for the company’s success and are also answerable for the company’s loss.
• Limited Liability: The most significant advantage of a private limited company is that the owners have limited liability. This means that the shareholders’ assets are protected if the company goes into liquidation. If the company goes bankrupt, the owners are only liable for the amount they have invested in the company. Any company’s money remains with the company and does not fall on the owners’ shoulders. This can be a significant advantage for new businesses as it protects their assets from potential business failures. One of the key benefits of setting up as a private limited company is limited liability.
• Separate Legal Entity: A private limited company is a separate legal entity from its shareholders and directors. This means that the company can contract with other businesses and individuals and is liable for its debts. In other words, creditors cannot seek direct payment from the personal assets of the business’s owners in case of debts or bankruptcy on behalf of the business. The only money that can be claimed directly in the company’s obligations and not those incurred by its owners on behalf of the business is shareholders. This can be essential protection for the shareholders as it limits their liability.
• Fund Raising: A Private Limited Company in India is the only form of business except for Public Limited Companies that can raise funds from Venture Capitalists or Angel investors.
• Free & Easy transfer of shares: Shares of a company limited by shares are transferable by a shareholder to any other person. The transfer is easy as compared to the transfer of an interest in a business run as a proprietary concern or a partnership. Filing and signing a share transfer form and handing over the buyer of the shares along with a share certificate can easily transfer shares.
• Uninterrupted existence: A Private Limited Company has ‘Perpetual Succession’, which is continued or uninterrupted existence until it is legally dissolved. A company, being a separate legal person, is unaffected by the death or other departure of any member but continues to be in existence irrespective of the changes in membership. ‘Perpetual Succession’ is one of the most important characteristics of a company.
• FDI Allowed: In a Private Limited Company, 100% Foreign Direct Investment is allowed that means any foreign entity or foreign person can directly invest in a Private Limited Company.
• Builds Credibility: The particulars of the company are available on a public database. This improves the credibility of the company as it makes it easy to authenticate the details

Documents Needed:

• PAN card
• Govt ID proof – Voters’ ID or passport or driver’s license.
• Bank statement.
• Utility bills either mobile or gas or electricity.
• Passport size photograph.
• Specimen signature – Director’s signature on a blank document.
• Address Proof.
• Notarized rental agreement
• NOC from the property owner
• A copy of the sale deed or property deed (for an owned property).

Compliances for Private LTD company:

• Appointment of Auditor.
• Annual ROC filing.
• Income tax.
• Filing of Financial Statements.
• Abridged Annual Return.

Registration Process:

• Finalizing the name of the company and have an availability check in MCA.
• Apply for DSC (Digital Signature Certificate)
• Apply for the DIN (Director Identification Number).
• Apply for the name availability.
• File the EMoA and EAOA to register the private limited company.
• Apply for the PAN and TAN of the company.
• Certificate of incorporation will be issued by ROC with PAN and TAN.
• Open a current bank account on the company name.

Simple and Transparent Services after Registration:

• Basic: Two DSC & DIN, RUN Name Approval, 1L Authorized Capital, Incorporation Fee and Stamp Duty. Incorporation Certificate, PAN and TAN.
• Standard: Two DSC & DIN, 1 RUN Name Approval, 10L Authorized Capital, Incorporation Fee, Stamp Duty. Incorporation Certificate, PAN, TAN, Incorporation Kit, Share Certificates and GST Registration.
• Premium: Two DSC & DIN, 1 RUN name approval, 10L Authorized Capital, Incorporation Fee, and Stamp Duty, Incorporation Certificate, PAN, TAN, Incorporation Kit, Share Certificates, GST Registrations, Udyog AADHAR and Trademark Registration.

Registration Duration: The whole process including approval of DIN, Name, and Incorporation takes around 10 working days.