Tag: Company Registration in India

Reasons to set up a limited company

ssdfszgfvb cSetting up a limited company will mean more administration and more paperwork than if you are a sole trader but there are many advantages to being a limited company, not least eliminating and personal financial liability.

When a sole trading business fails then the owner is personally responsible for any debt, which can have a negative effect on your credit rating and ability to obtain personal loans in the future. You could risk becoming personally bankrupt if the debts are too high for your to pay off.

If you set your business up as a limited company you are protected from this risk.

What are the Benefits :

Whilst running a limited company does have its fair share of responsibility, and the administrative responsibilities are certainly greater than other ways of working, there are many advantages too.

    • Limited liability – In simple terms, if you run a Limited Company you are protected should things go wrong. Assuming all rules have been followed, as a director you will not be personally liable for any financial losses made by the company.
    • Separate entity – A Limited Company is a legal entity in its own right. This means that everything from the company bank account, to the ownership of assets relates to the business. They are totally separate from the interest of the directors and shareholders.
    • Tax – As a director and shareholder of a limited company you could elect to take the majority of your income in the form of dividends, which enables you to manage your own tax liability and potentially save on National Insurance costs.
    • Perception – If you plan to do business with larger companies, it can help if you are working via a Limited Company as it gives off a more professional image. In some industries, it may even be a mandatory requirement as they will not deal with sole traders or partnerships.
    • Protection – As well as the limited liability protection mentioned above, once you have successfully registered your company, your company name is protected by law. Companies House has very stringent rules for the naming of companies so no one else can use the same name as you, or anything deemed too similar.
    • Ownership and succession – As the sole shareholder in your business, you own the business. However, a Limited Company can easily transfer ownership of shares, or existing shareholders can sell a stake in the company to other parties at any time. If for example a shareholder wishes to retire, or bring a new director on board, it is far easier to transfer ownership, or part ownership, of a Limited Company than it is with a less formal business structure.
    • Take home pay – It’s safe to say that this is the area where you can really reap the rewards of running your own Limited Company. The only person you need to pay as a Limited Company is yourself – combined with the tax efficiencies on offer, this means you can keep anything from 81 to 86 percent.


Accounts must be prepared each year but most small companies are not required to have them audited so the process is relatively simple, especially now that the process can be done online.

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Audits Under PCAOB Standards

A yearly audit is a key safeguard for your money and a planning tool for the year ahead. Think of it as a “year in review” for your finances.


The primary benefit of an annual audit under PCAOB standards  is the confidence it gives you and your members that the PTO’s financial house is in order. Basically, the audit verifies the numbers, ensures accuracy, and assesses procedures. A comprehensive audit also identifies internal controls that should be implemented to improve the integrity of your financial systems. Furthermore, the audit gives closure to the treasurer and sets a starting point for the new year’s activity. An audit is also the primary tool for uncovering financial mismanagement. Hopefully you won’t need to conduct an audit for this reason, but an annual audit can uncover problems before they become significantly more serious. Your PTO might also choose to include in your audit a review of how closely your group’s income and expenditures matched the year’s budget. This type of review can be a strong planning tool.


The audit is not within the jurisdiction of the PCAOB. This seems like a strange request.  Perhaps the client is a clearing agency or futures commission merchant registered with the Commodity Futures Trading Commission, which requires that entities registered with it have an audit performed in accordance with PCAOB standards. Maybe the client has entered into a contractual agreement that requires an audit conducted under PCAOB standards. Or maybe, for whatever reason, the client just wants an audit conducted under PCAOB standards.


The PCAOB determines which audits are within its jurisdiction, including audits of the financial statements of issuers and nonissuer brokers and dealers registered with the SEC. A regulator (other than the PCAOB) requiring that the audit be conducted in accordance with PCAOB standards does not make the audit fall within the jurisdiction of the PCAOB. Therefore, even though the regulator— for example, the CFTC— requires an audit to be conducted in accordance with PCAOB standards, that audit is required to also be conducted in accordance with GAAS.


The Auditor’s Report

The report from the auditor will mark the completion of the review. If you are using volunteers, you should clearly itemize what you expect back, so your auditors know when they have completed their job.

Ensure that your auditor has returned the files you provided, and file the original report in the PTOs permanent archives. At the first meeting of the new school year, you should present the auditors report and move that it be adopted. According to Robert’s Rules of Order, once the annual report of the auditor is adopted, it is no longer necessary to move to adopt each month’s treasurer’s report. The reports are presented and then simply filed for next year’s audit.


Related Things you should Know before Registering a Company in India


What is subsidiary company in India

slider3Subsidiary company is any company whose interests are held and controlled or held by another company. Paid up equity share capital and preference share capital of the subsidiary company can be used to determine the holding company, subsidiary company relationship between two companies.

What is a Subsidiary Company?

There’s often a lot of confusion regarding the position of the subsidiary company and what it does. A subsidiary company is a company that is either owned or owned in part by another company. The company that owns the subsidiary is known as a parent company or a holding company. It should be noted that a holding company does slightly differ from a parent company, though.

What is WOS (Wholly Owned Subsidiary)

When one company is 100% owned by another company, it is called Wholly Owned Subsidiary of the company who had made 100% investment in it.

How To Set Up a Subsidiary

To setup one of these companies, you only need a sole director. The requirement for a company secretary was waived some years ago. The only restriction is that the sole director cannot then act as the company secretary. When you register as a sole director, you will enter both your residential address and a service address. Only the service address will appear in the public records.

The key here is that in the various documentation you submit regarding shareholders you will have both an individual director and another company as a shareholder. You are prohibited from having an entire company owned by another company.

Once you submit the documents, you will have a decision within 24 hours from Companies House.


Opening up a subsidiary isn’t a decision that you should take lightly. It isn’t always necessary and it may be better to simply open a different company from scratch. You have to make this decision by yourself. And it may be better to employ a professional agent to help with the opening of your subsidiary.


Know more about how to register company in India

Ease of doing business: Government plans to introduce new integrated from for company registration.


The government plans to introduce a new version of the integrated company incorporation gurgaon form in a measure aimed at enhancing ease of doing business that targets reduction in average number of days for incorporating a company to one to two days from more than four days at present.

The new form, INC29, will have an option for entities to apply for director identification number or DIN and reservation of name through a single e-form.

“This new version of form INC29 will allow up to five directors to be appointed and greater flexibility in proposing a name for a company. Suggestions from the stakeholders are being taken,” the government said in a press release.

The reservation of a name, incorporation of company and appointment of directors of the proposed company can be filed in the integrated form. The government said the time taken for company registration gurgaon has already been halved through measures introduced to enhance ease of doing business.

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Setting up in India

These days, most people want to Setting up in India. From foreign nationals to NRIs to Indian residents, many people are looking at investing their money in India.Taj-Mahal-registers-an-increase-in-tourist-foot-falls-in-2014-over-the-year-2013 There are two reasons behind this trend.

One is because the Indian economy is growing at a fast pace and in the near future it has potential to grow more. The other reason is because India is a diversified country and hence it is the most favoured location for doing business. Being a diversified country, India offers different routes of investment to its people.

The most suitable for of entity for carrying out business in India would be to form a private limited company. The formation of a private limited company takes approximately 12-15 working days after receipt of the necessary documents.

In this article, we will discuss the procedure of forming a private limited company in India.

The minimum requirement to start a private limited company:

• Identify the directors of the company (minimum of 2 directors should be present and maximum of 8 is allowed).

• Minimum 2 shareholders

• Minimum capital of the company should be INR 1,00,000/-

• DIN (Directors Identification Number) for both directors. If you do not have one, you can apply for it online

• Digital signature of all directors

• Reservation of the name of the company (You can submit 5-6 names in the order of which you prefer. Based on

 availability, you get your company name)

• Apply for company incorporation

• Consent from subscriber to director

• Preparation of documents such as Memorandum of Association.

• Filling documents with authorities

• Liaison with the authorities and correction

• Proof of registered address

• NOC from the owner of the premises

• Getting final certificate of incorporation

• The most important step in forming  a  LLP registration in India is applying for DIN. Only directors that do not have

 this need to apply. They need to submit the form to the central government with a fee of rupees1500 per director.

• Obtaining digital signatures is the next step. The director has to apply for the digital signature certificate. This is

necessary to file company registration documents.

• Submit 5-6 preferred names for your company in order of the most preferred. Check for name availability.

• Apply for name availability to the concerned ROC.

• Once the name has been approved, you need to apply for Company incorporation For this, you will have to prepare a Memorandum of Association that details company operation and list of directors.

• Once it is approved, make at least 10 copies of Certificate of Incorporation and Memorandum of Association and have it in a booklet form.

• You will then have to fill various forms in the ROC.

• You will have to submit proof of registered address (pan card, voters id)

• Filling fees for final documents

• Other government expenses

• If the registrar is satisfied with all the requirements that have been compiled by the company, they will issue certificate of incorporation. The date mentioned on the certificate is the date of incorporation of the company.

• Lastly, you can open a current bank account in any leading bank to carry out your operations.

Therefore, formation of a private limited company is not that difficult as it seems. If you lack the expertise to do it on your own, you can always take the advice and assistance of professionals. Roughly, formation cost of a company should be INR 25,000.Company Registration in India