Some new companies are not sure what type of business to start. If you are looking to do something more personal, but still wants to make a profit, then you might want to think about starting a Private Limited Company.
Private Limited Company, also called Ltd., is a company like any other company, but it is private, which means it is not publicly traded. Private Limited Company or Ltd. is a company like any other company, but it is private, which means it is not publicly traded.
Types of Private Limited Company in India
There are three types of a private limited company in India:
1. Private Limited Company with Shares
This type of company is owned by a group of individuals, each of whom holds shares in the company.
2. Private Limited Company with a Guarantee
This type of company is owned by a group of individuals, each of whom holds shares in the company. However, the company is also guaranteed by another company or individual. This type of company is usually used for larger businesses.
3. Unlimited Company
An unlimited company is a type of company that is not limited to the liability of the members. This type of company is rare in India, and it is typically used by larger businesses. An unlimited company can distribute its profits to its shareholders without any restrictions.
Benefits of Private Limited Company in India
There are several benefits of private limited company registration in India. Some of the most notable benefits include:
1. Limited Liability:
One of the key benefits of forming a private limited company is the limited liability protection it provides to its shareholders. This means that shareholders are only liable to the extent of their investment in the company and they are not personally liable for the company's debts or liabilities.
2. Tax Efficiency
Private limited companies are often more tax-efficient than other business structures. This is because they can take advantage of various tax reliefs and exemptions that are available to them.
3. Increased Credibility
A private limited company often carries more credibility than other business structures. This is because it is a more formal and structured business entity.
4. Corporate Governance:
Private limited companies are required to comply with several corporate governance requirements. This helps to ensure that they are run in a responsible and accountable manner.
Incorporation of a Private Limited Company
A private limited company is a type of company incorporated under the Companies Act 2013. It is a company limited by shares and has a share capital. The shares may be held by either individuals or by another company.
A private limited company must have at least one director and one shareholder. The director may be the shareholder, or the shares may be held by a third party. The company must have a registered office in India and must keep accounting records and a register of shareholders.
The company must file annual returns and must also file annual accounts. These accounts must be prepared in accordance with the Companies Act 2013 and must be audited if the company's annual turnover exceeds 50 lakh.
The company is dissolved if it ceases to be a private limited company, or if it is struck off the register of companies.
Documents Required for Private Limited Company Registration
1. Certificate of Incorporation
2. Memorandum and Articles of Association
3. Share Certificate(s)
4. Form INC-2
5. Form DIR-12
6. PAN Card of the Company
7. Director's Identification Number (DIN) of Directors
8. Address Proof of the Registered Office
9. Proof of Residence of Directors
10. Utility Bills of the Registered Office
11. E-Form SPICE
How is a Private Limited Company different from a public limited company?
A regular company is a public company, which means that it can offer its shares to the public and is subject to a variety of regulations. A private limited company is not subject to the same regulations and can only offer its shares to a limited number of people. Get your company registration in India with the Expertbells team.
