Do you want to know how to register a company in India? The process of company registration is a lot simpler in India at present. In this article, we will walk you through the process of company registration in India step by step.
Once you have come up with a business idea and decided to start a business you will need to follow some procedures to register a company in India.
There are broadly 5 Popular ways to register a company in India.
If you are just starting a business as an individual with a very small investment of your own, you can go for a sole proprietorship firm. It is easy to form without thinking much of compliances.
If two or more individuals want to start a business with an investment of their own, they can opt for a partnership firm. However, in this formation, partners are personally liable for any loss incurred in the business. This formation works only when the partners have complete faith among themselves.
One person company formation is the new entrant in the company registration process in India. This concept was introduced by the Companies Act of 2013. As the name suggests a single individual can form a company with several benefits while enjoying the freedom of a sole proprietorship.
Limited Liability Partnership or popularly called LLP is another relatively new way of registering your company. Since its launch in the year, LLP has become the most popular company incorporation route for new startups. This company formation provides freedom of partnership with limited liability benefits to business owners.
Private Limited company is generally formed two or more individuals agree to associate together for a common business interest This kind of formation is useful for raising capital from financial institutions, angel investors, venture funds, etc.
Depending on the nature and resource of your business, you need to decide on what kind of business formation to incorporate.
Find below step by step guide on the process to register a company in India.
Step by Step Procedure to Register a Company in India
There are mainly 5 steps you need to follow while registering a business in India. They are the following:
1. Obtain Digital Signature Certificate from an MCA-authorised agency
The first step for a person to register a company in India is to apply for a Digital Signature Certificate, commonly named DSC. This is simply an e-signature which will be needed in every step of the company registration process online.
The time to receive DSC is normally around 2 to 5 days.
An entrepreneur needs to submit the completed Class-II form, self-attested copy of PAN card and self-attested copy of Voter ID/Ration Card/Driver’s License/Latest Utilities Bill/AADHAR Card.
In the case of a foreign national, a copy of the Passport is required to apply.
2. Preparing INC-29
The process of registering a company in India has become easier with the introduction of the INC-29 form by the ministry of corporate affairs.
Procedures like name approval, applying for Director Identification number(DIN), application for incorporation, etc have been rolled into one.
The INC-29 is an eight-page form requiring several pieces of information and documents. In some of the document, you need a Company Secretary’s signature, to be submitted in one go.
While preparing INC-29, consider the following:
Once you’ve decided a name for your business, also describe the significance of the name in one or two sentences. It would need to be entered into the form.
While applying to ensure the following:
The company’s proposed name has not already been taken on mca.gov.in.
There is no registered trademark in the same name by checking at ipindia.nic.com.
The first half of the name is unique. Avoid geographical references, adjectives, abbreviations, and generic terms.
The second half amply clears the sector you’re in.
Memorandum and Articles of Association
The Memorandum of Association (MoA) and Articles of Association (AoA) need to be attached to the INC-29. Generally, a Company Secretary drafts it and it should contain the signature of one. The MoA will also contain the main objects of your business
All companies must have a registered office address. It does not mean that you need to have a commercial space. It can even be the home address of a director. But the details need to be provided, along with a copy of the Rental Agreement along with a NOC from the owner (if rented property) and sale deed (if the property is owned).
Appointment Letters and Declarations
Several different attachments need to be submitted along with the application.
Some of them are:
a) Letters of appointment of directors, CEO, managers
b)Declaration by the first director in INC-9
c) Declaration by the appointee director and managing director in Form DIR-2.
3. Filing INC-29
After filling the form INC-29, you will be directed to pay the fees and stamp duty to a payment gateway. The fees will change according to the authorized capital fee and the stamp duty will vary according to your location.
4. The issue of Incorporation Certificate
Once you receive incorporation certificate, you are now eligible for registration of PAN, TAN, PF, ESI etc. Find below a detailed list has been given including major necessary requirements with estimated cost and time required.
You can check for the latest fees to be paid for filings HERE.
Please remember that these are standard procedures and are applicable in most of the cities in India. however, in some cities, there are some additional (or lack of) processes that you will have to find out. Check this article in future too as we constantly update the procedures for registering a company in India.