Business Start-ups
In Today's world, it is considerably easier to set up or start up a company in India. Nowadays it needs a lesser time frame to start your business in India compared to past years. It takes only less than 5 weeks to register a company in any part of India. With the digitalization of the company registration process, the time consumed for company registration has come down dramatically.
Before anyone is planning to start a business in India, the business owner must decide upon which type of business it should be. In general, there are two types of business entities like private limited companies and public limited companies. Other than these common business entities there are other types that are based on the particular needs of the business owner.
Legal and various types of document works are involved in starting a business in India other than approvals from the Government of India. We can assist you in registering your company in India along with getting vital documents and approvals from the government.
Entry Requirements for doing business in India
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Public Limited Company
A company that can offer shares to the public is termed a public limited company. The Companies Act 1956 mandates a list of criteria that have to be met by the public limited companies before they start their business operations in India. It should have at least seven shareholders and a minimum of 3 directors on its board. The company should release a prospectus or issue a statement to sell its securities.
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Private Limited Company
A private limited company is not owned by any governmental body, and it does not offer public shares. The number of shareholders for a private limited company is restricted to a maximum of 50, whereas the minimum required is 2. The shareholders, however, do not have the power to transfer or trade their shares publicly.
Sole Proprietorship
This is the most common type of business entity. Sole Proprietorship means that there is a sole owner who funds as well as operates the business. Being one of the simplest forms of business entities, it is relatively formality-free with no rules regarding records required to be kept, no requirements of having your accounts audited, and no requirements of filing financial information to the registrar of companies. In short, there is no legal distinction between you and your business.
Partnerships
A partnership is a type of business entity, where you are partner with other individuals to own and run the business. On a higher level, they can be viewed as a collection of sole proprietors. In this case, you get access to a bigger pool of capital, skills, and other resources to fund and run your business.
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Limited Liability Partnership
The LLP shall be a body corporate and a legal entity separate from its partners. Any two or more persons, associated with carrying on a lawful business with a view to profit may be subscribing their names to an incorporation document and filing the same with the registrar, form a limited liability partnership. Being a separate legal entity, LLP is liable to the full extent on its assets, the liability of the partners would be limited to their agreed contribution in the LLP.
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One Person Company
A one-person company is a company that has only one person as to its member. Furthermore, members of a company are nothing but subscribers to its memorandum of association, or its shareholders. So, an OPC is effectively a company that has only one Shareholder as its member. Since an OPC is a separate legal entity distinguished from its promoter, it has its own assets and liabilities. The promoter is not personally liable to repay the debts of the company.