Proprietorship
A sole
proprietorship, also known as the sole trader or simply a proprietorship, is a
type of business entity that is owned and run by one individual and in which
there is no legal distinction between the owner and the business. A sole
proprietorship is a business that is owned, managed and controlled by one
person. It is one of the most common forms of business in India, used by small
businesses operating in the unorganized sectors.
Proprietorship's
are very easy to start and have very minimal regulatory compliance requirement
for getting started. However, after the startup phase, proprietorship's do not
offer the promoter a host of other benefits such as limited liability, separate
legal entity, independent existence, transferability, etc., which are desirable
features for any business. Therefore, proprietorship's are suited for
unorganized, small businesses that will have a limited existence.
Preetham
Shetty & Co. can help start-up a Proprietorship in 7 to 14 days, subject to
Government processing time. Since the proprietorship is itself not
distinguishable from its owner hence there is no registration or approval is
required to start a proprietorship business. Proprietorship's do not have a
process of incorporation. Therefore, our Business Advisers will advise you on
the way the identity of the Proprietorship business can be established through
other Government registrations.
There is
no mechanism provided by the Government of India for the registration or
incorporation of a Proprietorship. Therefore, the existence of a proprietorship
is established only by tax registrations and other business registrations that
a Proprietorship is required to have as per the rules and regulations. At
Preetham Shetty & Co., we can help you establish an identity for your Proprietorship
by obtaining the relevant registrations.
Hindu Undivided Family (HUF) Registration
HUF –
Joint Hindu Undivided Family Business is a distinct type of organization which
is unique to India. Hindu Undivided Families are the form of organizations has
separate legal entity for the purpose of tax assessment. As the name suggests,
an HUF is a family of Hindus. However, even Buddhists, Jains and Sikhs are
regarded as Hindus, and can, therefore, set up HUFs. The concept of an HUF has
basically evolved from ancient Hindu law. The HUFs have been defined under the
Hindu law as a family, which consists of male lineally descended from a common
ancestor and included their wives and unmarried daughters.
The
relation of HUFs arises from the status not from legal contracts. Creating HUFs
are the best possible way for an assessee to save taxes.
The
registration of Joint Hindu Undivided Family is recommended as it helps in
protection against infringement.
Partnership Company Registration
A
Partnership Firm is a popular form of business constitution for businesses that
are owned, managed and controlled by an Association of People for profit.
Partnership firms are relatively easy to start are is prevalent amongst small
and medium sized businesses in the unorganized sectors. With the introduction
of Limited Liability Partnerships in India, Partnership Firms are fast losing
their prevalence due to the added advantages offered by a Limited Liability
Partnership.
There
are two types of Partnership firms, registered and un-registered Partnership
firm. It is not compulsory to register a Partnership firm; however, it is
advisable to register a Partnership firm due to the added advantages.
Partnership firms are created by drafting a Partnership deed amongst the
Partners and Preetham Shetty & Co. can help start a registered or un-registered
Partnership firm in India.
One Person Company Registration
With the
introduction of the Companies Act, 2013 the concept of OPC (one person company)
was introduced to support entrepreneurs who on their own are capable of
starting a business by allowing them to create a single person economic entity.
Only one single member is required to incorporate an OPC, which is the biggest
advantage of OPC over private limited companies & partnerships. Similar to
a Company, an OPC is a separate legal entity from its members, offers limited
liability protection to its shareholders, is easy to incorporate and continues
in the foreseeable future.
This is
a new concept introduced by the Companies’ Act 2013 and is available for a
business with a capital up to Rs.50 Lacs and a turnover up to Rs.2 Crore. The
one-person company has some benefits in the companies act in terms of
non-applicability of some provisions of the new act.
Limited Liability Partnership (LLP) Registration
Limited
Liability Partnership Act, 2008 brought with itself the concept of LLP. The
benefits of LLP are that it is simple to maintain & it provides the
privilege of limited liability to the owners. Thus, combines the benefits of
both company & partnership into a single organization. One partner is not
responsible or liable for another partner's misconduct or negligence.
Therefore, all partners have a sought of limited liability for each
individual's protection within the partnership, similar to that of the
shareholders of a corporation.
The only
difference between the company and the LLP is that, the partners have the right
to manage the business directly. Also, the personal assets are free from the
errors, omissions, incompetence, or negligence of the LLP's employees or other
agents. Thus, LLP is one of the easiest forms of business to incorporate and
manage.
Private Limited Company Registration
A
private company can be incorporated by following the provisions and regulations
stated under the Company's Act 2013. The minimum number of persons required for
the incorporation is 3. Whereas the maximum limit of the number of persons is
50. There are many benefits that are achieved by a private limited company. It
enjoys a greater stability, legal identity, it is flexible and a greater
combination of capital. This is supported with the diversified and different
abilities of capital accumulation. The private company can be easily identified
by just looking at the name, number of members it incorporates, the
managements, directors etc. The number of directors who are to incorporate must
be mentioned in Articles of Association. However, the private companies who
enjoy its distinguished legal entity and the private companies which are the
subsidiary of the other public companies is differentiated in Company's Act.
Preetham
Shetty and Co can write and structure your company's objective, purpose,
constitution, vision and mission statement, which will appeal to all
stakeholders Help in selecting a very catchy name of your company and do the
registration, and complete all the government procedures and compliance Do
INC-32 Filing and File for PAN & TAN.
Public Limited Company Registration
A
limited company grants limited liability to its owners &management in which
it’s belong. Being a public company allows a firm to sell shares to investors
this is beneficial in raising capital. it has required more stringent
regulatory requirements as compared to a Pvt. Ltd Company.
A Public
Ltd Company has almost all the characteristics of a private limited company. A
Public Limited Company, in addition to the steps followed by a Private Limited
Company has to obtain a certificate of Commencement of Business before they can
commence the business.
Indian Subsidiary
There is
a lot of interest among foreign companies to start their operations in India
and tap into one of the largest and fast growing market, and have access to
some of the best human resources in the world. A Foreign National (other than a
citizen of Pakistan or Bangladesh) or an entity incorporated outside India
(other than entity incorporated in Pakistan or Bangladesh) can invest and own a
Company in India by acquiring shares of the company, subject to the FDI Policy
of India. In addition, a minimum of one Indian Director who is a Indian
Director and Indian Resident is required for incorporation of an Indian Company
along with an address in India.
When an
Entity which is incorporated outside India (i.e. Foreign Country), makes 100%
Foreign Direct Investment (FDI) as per Indian FDI policy, the Indian company
incorporated for this purpose is said to be wholly owned subsidiary of that
foreign entity. Under the current foreign investment policy, a wholly owned
subsidiary can be established either under the automatic route, if the
conditions specified therein are complied with (specific high priority
industries) or obtain an approval from the FIPB. This is the easy and best
method for setup a foreign based Company in India, where entire hold on share
capital of a Indian company is hold by Foreign Based Entity.
Liaison Office in India
Foreign
companies planning to set up their business operations in India need to start a
liaison office. The main purpose of starting a liaison office is to explore
possible business opportunities in India by gathering relevant business
information. This helps the companies to develop a business strategy to tap the
existing business potential in India. A liaison office also acts as a marketing
channel to provide business information about the parent company and their
products to the prospective clientele in India.
Section 8 Company
Generally,
companies are promoted with an object of making profit by carrying commercial
transactions. But a company can be registered with charitable motive with the
object not to make any profit also. These companies must be formed with an
object to promote of commerce, art, science, sports, education, research,
social welfare, religion, charity, protection of environment or any such other
object. Meaning of Non-profit making Company. The name of a Company registered
under Section 8 of the Act, the name shall include the words foundation, Forum,
Association, Federation, Chambers, Confederation, council, Electoral trust etc.
As per
section 8 of Companies Act 2013,where it is proved to the satisfaction of the
Central Government that a person or an association of persons want to register
themselves under section 8 as a limited company for the furtherance of above
mentioned objects, the Central Government may, by license issued in prescribed
manner allow that person or association of persons to be registered as a
limited company under this section without the addition to its name of the word
“Limited”, or as the case may be, the words “Private Limited” , and thereupon
the Registrar shall, on application, in the prescribed form, register such
person or association of persons as a company under this section.
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