Introduction
A Private Limited Company or PLC as it is commonly known is a separate legal entity with a Limited Liability. A PLC must have at least 2 Directors& Shareholders and has NO Minimum Capital Requirement. It is a preferred entity for startups who want to raise funding and for entrepreneurs wanting lower Income Tax for their business.
-Entrepreneurs who want to raise Seed or Venture Capital.
-Entrepreneurs who want to create a Separate Legal Entity with Limited Liability and Perpetual Succession.
-Entrepreneurs who want to issue ESOP’s to their employees.
7-10 working days from the time we receive the required documents.
Click here to Download the List of Documents required for the Formation of your Private Limited Company. Basic documents of the Shareholders, Directors and the Registered Office like PAN Cards, Address Proofs, Electricity Bill etc. are required.
The Cost to form a Private Limited Company starts From Rs 12,355/-. Click here to know the calculation of the cost according to your Capital and State. This Cost includes Professional Fees, Government & ROC Fees, Stamp Duty, 2DINs, 2 Digital Signatures, PAN and TAN.
Advantages
Limited Liability:
The liability of the shareholders of a Private Limited Company is Limited to their Shareholding. Thus, if the Private Limited Company makes a Loss, shareholders won’t have to pay the Loss beyond their Unpaid Share Capital.
Separate Legal Entity:
A Private Limited Company is separate and distinct from its Shareholders and Directors. It can buy and sell property, enter into contracts, sue or be sued upon in its own name. The death, insanity, incapacity or insolvency of its shareholders and/or directors does not affect the existence or business of the Company in any way.
Perpetual Existence:
Once formed, a Private Limited Company has a life-time existence until and unless it is liquidated.
Ease of raising Seed and Venture Capital:
If you’re planning on raising Seed or Venture Capital then only a Private Limited Company makes sense for you. Angels, Seed Funds or Venture Capitalists only fund a Private Limited Company.
A good way to reward and retain talent-ESOP’s:
The success of a business depends on the quality of the team or the talent behind it. It is very necessary for businesses to retain and attract talent. A Private Limited Company can issue ESOP’s or Sweat Equity Shares (as it is commonly referred to) to deserving employees in order to retain and reward them. This is not possible if business is registered as a Proprietorship, Partnership or LLP.
FAQ’S
Basic
EVERYTHING is INCLUDED in the cost above. Your company will be incorporated in the above price!
No. There is no such condition to Rent an Office to start a Company. You can even start your Company from a Residential Address. We just need the Latest Electricity Bill of the Property, an NOC from the owner and a Lease Agreement (If Any) for Registering your Company.
The Registrar of Companies (ROC) has introduced a new form for Formation of Companies. This form reduces the time taken for Incorporation of the Company from 15-20 working days to 7-10 working days. We use SPICe+ forms to incorporate your Company as this speeds up the process to form your Company.
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Yes.
The minimum authorised capital required to start a Company is Rs 1,00,000/- This means that the Company is authorised to issue shares upto Rs 1,00,000/- It is the authorised capital of the Company and not it’s paid-up Capital. In other words, the Shareholders do not have to deposit Rs 1,00,000/- into the Company’s Bank Account but have to deposit only that amount of which they purchase shares in the Company.
The Company formation procedure is completely online. There is no need to go to the ROC’s office to set-up your Company. Just scan, email and courier us the documents we require and we will Register your Company.
Yes. We will draft the Memorandum of Association (MOA) and Articles of Association (AOA) of your Company. The MOA and AOA will be sent for your Approval post drafting.
Advanced
A Private Limited Company can have a maximum of 200 shareholders. However, employees of the Company (past and present) who hold shares in the Company will not be considered in the count of 200.
A Private Limited Company can have a maximum of 15 Directors. However, a Company can increase the number of Directors beyond 15 by passing a Resolution.
The Net Profits of a Private Limited Company are taxed @ 25% if your Turnover is less than 400 crores and 30% in all other cases. We can show 22% and 15% as well
Limited Liability means that if your company incurs a loss, the Shareholder’s contribution to that loss will be limited to her/his Capital in the Company. For example, if your Company makes a Loss of Rs 1,00,000/- and the Company doesn’t have enough assets to pay off the loss. In that case, the Shareholders will have to contribute only their agreed capital and nothing above that. Suppose the agreed capital comes up to Rs 20,000/- then the difference of Rs 80,000/- will not have to be paid by the Shareholders. In all cases, the Directors of the Company will never contribute to the losses of the Company except in case any fraud or wrongful act committed by her/him
Employee Stock Option Plan (ESOP) or sweat equity shares as they are commonly known are Equity Shares of your Company which are issued to your Employees. Post issue of equity shares of your Comppany, the employees of your Company become part owners of your Company. They are widely used by Companies such as Infosys, TCS, Facebook, Google etc. to retain their employees and attract talent.
Director Identification Number (DIN) or Designated Partner Identification Number (DPIN) is a number which is required to become a Director in a Company or a Designated Partner in an LLP . This number is issued by the Ministry of Corporate Affairs (MCA). The procedure to issue this number is an online process and is a once in a lifetime procedure.
The Forms which are used for incorporating your Company are to be signed digitally. There is NO need of a Physical Signature on the forms. The signing of these forms are done with the help of your Digital Signature. Simply put, a Digital Signature is your Signature in an Electronic form. A digital signature can be used to sign all Registrar of Companies (ROC) forms as well as your Company’s/LLP’s Income Tax returns.