How to register a private limited company in india?

A Private Limited Company is one of the most popular and trusted business structures in India. Registration of a private limited company offers both credibility and scalability because it has a distinct legal identity, limited liability, and is capable of attracting investors. If you’re an entrepreneur starting your first business or a startup looking to expand, understanding the private limited company registration process is crucial. Throughout this article, you’ll learn all about the benefits and documentation of this program, as well as the registration process in India.

Understand Private Limited Company

A Private Limited Company is an entity that limits liability of the owners and restricts the ability to share transfers. It is also written as “Pvt. Ltd. Company” which is registered under the Companies Act, 2013. In this company the maximum shareholder number is 50. This company structure is well-suited for SMEs (Small and Medium-sized business) due to its limited liability protection, smooth ownership control and flexibility. 

Features of Private Limited Company: 

• In Pvt. Ltd. Company the liability of a shareholder is limited. 
• It should have minimum 2 and maximum 200 members. 
• Perpetual Succession, it continues even if shareholders/directors changes
• Restriction on transfer of shares
• Mandatory compliance with ROC filing, meetings and audits
• No minimum capital requirement
• They can raise funds through private investors. 

Advantages of Private Limited Company 

There are multiple advantages for private Limited Company, some of them are – 

1. In Private Limited Company, the owner’s personal property is protected from any loss of company.
   
2. It is a separate legal entity that exists independently from its directors and shareholders.
   
3. It has perpetual succession which means a  Pvt. Ltd. Company continues even after the death or exit of a member.
   
4. Private Limited Structure preferred for venture capital, bank funding and angel investment.
   
5. It has also flexible ownership where shares can be transferred easily among the members.
   
6. Pvt. Ltd. Companies are also eligible for startup india and lower tax rates for small companies.
   
7. It also secured the brand by registering their name legally under the Company Act, 2013. 

Requirement for Registering a Private Limited Company in India

There are some requirement for registering a Private Limited Company in India, these are –

1. The Private Limited Company must have at least 2 minimum directors and shareholders.
   
2. Every proposed director should have a valid DIN.
   
3. Every Directors and shareholders should have Digital Signature Certificate (DSC) for form filing.
   
4. Company name should be unique and not similar to any existing company name.
   

Documents for Registering a Private Limited Company in India 

Documents for Registering a Private Limited Company is as follow: 

1. PAN Card of all shareholders and directors
2. Aadhar Card of all shareholders and directors
3. Address Proof (any utility bill not older than 2 months)
4. Latest Bank Statement
5. Passport-size photographs of each shareholders and directors
6. Each Director Email-ID and Mobile number
7. Proof of Ownership 
8. Rent Agreement (in case of rented property)
9. NoC from the property owner (in case of rented property)

Process for Registering a Private Limited Company in India 

Stepwise process for Registering a Private Limited Company in India is as follow: 

Step 1: Obtain a DSC of all directors first which is essential to file forms on the MCA portal and sign digitally on documents such as e-AoA and e-MoA.

Step 2: check the availability of the name of the proposed company through the MCA portal. If the name is unique the ROC approves the name within 20 days.

Step 3: File the incorporation form that is Form SPICe+ Part B. You need to submit all the documents along with this form at the time of form submission. 

Step 4: After the form submission it will go for examination by the department if there are no discrepancies and errors, they will issue the certificate. Otherwise the applicant gets informed if there is any issue related to the form submission.

Step 5: Once this certification has been done, you need to go with post compliances which come within 30 days from the approval. 

Fees for Registering a Private Limited Company in India 

The fees for registering a Private Limited Company in India may vary from ₹6,000 to ₹30,000 which mainly depends on several factors including company authorised capital, professional fees and other services. 

Frequently Asked Questions

1. What is the minimum turnover for a Private Limited Company?
   There is no minimum turnover for a Private Limited Company.
2. What is the cost for Private Limited Company Registration?
   The cost for a Private Limited Company registration in India may range from ₹500 to ₹5000 which is determined by the authorized capital.
3. Can I register a Private Limited Company in India by myself?
   Yes, you can register your Private Limited Company by yourself but it is a complex process and small mistakes lead to rejection. Therefore, consulting with a professional is important to avoid this hassle.
4. Is GST Mandatory for Private Limited Company?
   Yes, every company including Private Limited Company mandates to get GST.
5. Can a person already in Job be a director in a private limited company?
   Yes, a person already in employment can be a director in a company. However, they need to check their employment terms first.

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