There are a few good reasons why it makes ample sense to register your network. The first basic reason is to safeguard one’s own interests by no means risk personal assets to the aim of facing bankruptcy in case your business faces an emergency and also is forced to shut down. Secondly, it is easier to attract VC funding as VCs are assured of protection if the company is registered. It provides tax benefits to the entrepreneur typically in a partnership, an LLP and even limited company. (These are terms which have been described later on). Another valid reason is, in the eventuality of a limited company, if wishes to transfer their shares to another it’s easier when company is enrolled.
Very there’s always a dilemma as to when the company should be registered. The answer to which is, primarily, if your business idea is good enough to be converted into a profitable business or not solely. And if the answer to the confident which has a resounding yes, then it is time for in order to go ahead and register the investment. And as mentioned earlier on it is always beneficial to do it as a preventive measure, before damaging saddled with liabilities.
Depending upon the type and size of the business and when there is want to expand it, your startup could be registered as among the many legal formats in the structure on the company on the market.
So allow me to first educate you with needed information. The various company structures available are:
a) Sole Proprietorship. Of your company managed or run by only individual. No registration it takes. This is the method to if you must do it for yourself and the goal of establishing the company is to realize a short-term goal. But this puts you liable to losing every personal assets should misfortune strike.
b) Partnership firm. Is owned and operated or run by at least two or higher than two individuals. In the a Partnership firm, as the laws are not as stringent as that involving Ltd. Company, (limited company) it demands a lot of trust regarding the partners. But similar to a proprietorship thankfully risk of losing personal belongings in any eventuality.
c) OPC Registration Online in India is a one Person Company in which the company is really a separate legal entity within turn effect protects the owner from being personally liable for any cutbacks.
d) Limited Liability Partnership (LLP), while general partners have limited liability. LLP combines the best of partnership firm and a supplier and the partners are not personally liable to lose their personal wide range.
e) Limited Company that’s of 2 types,
i) Public Limited Company where minimal number of members needed are 7 and there isn’t a upper limit; the quantity of directors should be at least 3 and
ii) Private Limited Company where minimal number persons needed are 7 with a maximum maximum of fifty five. The number of directors must be 2.