Startups and fast growing company aiming to raise funds from Investors generally prefer Private Limited Company. It is the most popular type of corporate legal entity in India. It is also the most credible structure of doing a business. Private limited company registration is governed by the Ministry of Corporate Affairs, Companies Act, 2013 and the Companies Incorporation Rules, 2014.
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Owner's/ Share holders Liability is limited to Share Capital Subscribed and unpaid by them.
After Company registration is done, a legal entity is born in eyes of law. This separates itself from its owners and managers. The Company is known by its own name and not by its Director/Shareholder.
Unlike partnership/ proprietorship which gets dissolved on the death of its owner, Pvt Limited Company continues its operation as shares are transferred to the nominee and new Director is appointed.
Pvt. Ltd. Company registration process is compliant enough to make this structure credible among others which makes fundraising or borrowing from external sources easier.
A Single Person Company is benefited with an exemption to many compliances unlike a private company. Compliances like holding General and Board Meeting, etc. are not applicable to OPC. However, Board Meeting must be held if more than one director is on Board.
PAN Card of shareholders and Directors. Foreign nationals must provide a valid passport.
Aadhar card and Voter ID/ Passport/ Driving License of Shareholders and Directors.
Latest Telephone Bill /Electricity Bill/ Bank Account Statement of Shareholders and Directors.
Latest Passport size photograph of Shareholders and Directors.
Latest Electricity Bill/ Telephone Bill of the registered office address
No Objection Certificate to be obtained from the owner(s) of registered office
Rent Agreement of the registered office should be provided if any
In case of NRI or Foreign National, documents of director(s) must be notarized or apostilled
Fill up basic details in form & share required documents.
Do nothing & Cooperate with us.
You will get the registration certificate
| Entity Type | Private Limited Company | One Person Company | LLP | Partnership Firm | Sole Proprietorship | |
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| Act | Companies Act, 2013 | Companies Act, 2013 | Limited Liability Partnership Act, 2008 | Indian Partnership Act, 1932 | No Specified Act | |
| Liability Of The Owner/Shareholder/Partner | Limited to share | Limited to share | Limited to share | Unlimited | Unlimited | |
| Liability of members is limited to the extent of unpaid value of shares subscribed | Liability of members is limited to the extent of unpaid value of shares subscribed | Liability of partners is limited to the capital amount agreed to introduce | Partners are jointly and severally liable to pay the debts of the Partnership Firm | Personally Liable for all the debts. | ||
| Taxation | Low | Low | High | High | Low | |
| Basic Taxation.(Surcharge Varies As Per Income) | 22% | 22% | 30% | 30% | Slab Rates | |
| Dividend Distribution Tax | 20.34% | 20.34% | NA | NA | NA | |
| Minimum Shareholders | 2 Directors and Shareholders | 1 Person | 2 Partners | 2 Partners | 1 Person | |
| Maximum Shareholders | 200 Shareholders | 1 Person | No Limit | 100 Partners | 1 Person | |
| Duration for Registration | 7 - 10 working days | 7 - 10 working days | 7 - 10 working days | 7 - 10 working days | 2-3 working days | |
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Income Tax Return | Income Tax Return | |||
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Following are the basic requirements to register an OPC:
Formation of Partnership Firm does not require any minimum amount. It can be started with any amount of capital contribution by the partners. The Partners can contribute in any amount agreed and in any form being tangible (cash, premise) or intangible (goodwill, intellectual property). The Partners can introduce capital in any ratio, equal or uneven.
Due to non-registration, the firm cannot file suit against any partner or the third party. A partner also cannot sue the partnership firm for his claim. However, the third parties can sue the firm to enforce their dues or claims. Non-registration does not affect the rights of third parties. Also, the partnership can be registered any time after formation to remove the said effects.
It is possible to form a partnership firm with only two partners by following the process described. Further, the Partner to be introduced and appointed in the Firm must be an Indian resident and citizen. NRI and Persons of Indian Origin can only invest in a Partnership with prior approval of the Government. The individual must be competent to contract and not a minor. A minor can be introduced to a Partnership Firm only for profit.
Only a registered partnership firm can claim a set off (i.e. mutual adjustment of debts owned by the disputant parties to one another) or other proceedings in a dispute with a third party. Hence, it is advisable for partnership firms to get it registered sooner or later. Also, only a registered partnership firm can file a suit in any court against the firm or other partners for the enforcement of any right arising from a contract or right conferred by the Partnership Act. An unregistered Partnership Firm can get registered at any point of time after its establishment.
The application for Partnership Firm Registration in India is submitted with the Registrar of Firms (RoF) under whose jurisdiction the Place of Business of Partnership Firm falls. The application of Registration is made in required form along with submitting the Partnership Deed. At the end of the registration procedure, the Certificate of Registration is issued by respective RoF. The process and time of registration may differ for each RoF.
The Partners should specifically mention about the main object and activities along with major clauses related to capital contribution, profit sharing ratio of the partners, management and administration of Partnership Firm. Further, the signed Partnership Deed shall be duly stamped and notarized.
To confirm the validity of the partnership deed, the partners must pay stamp duty required as per the capital of the firm. The amount of stamp duty payable depends on the amount of capital contribution by partners. The rate of duty is prescribed under State Stamp Act and which is different for every State. Amount of INR 500 is included in our package.
Yes, notary on Partnership Deed is necessary in every case for an unregistered or registered partnership firm.
Applying for the PAN and TAN is possible after the execution of a Partnership Firm Agreement or after partnership deed registration with respected RoF. The physical copy of the PAN will be received at the registered Business Place only after being dispatched by the Income Tax Department.
The registration of Partnership Firm in India can take 12 to 14 working days. However, the issuance of Registration Certificate can take place as per the regulations of the concerned state. The time period for registration of Partnership Firm is subject to Government processing time and that varies for every State.
The Partnership Firm shall maintain the Books of Accounts and Financial Statement. The Income Tax Return shall be filed for the respective financial year before the due date as per the Income Tax Act.
Partnership firms do not need to prepare audited statements for each year. However depending on the turnover and a few other criteria, a tax audit statement might be necessary.
A partnership firm can be converted to a Private Limited Company or a LLP considering its requirements. However, the procedures to convert a Partnership firm into a Company or LLP are cumbersome, expensive and time-consuming. Thus, it is wise for many entrepreneurs to consider and start a LLP or Company instead of a Partnership firm.
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