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Company registration

By Peeyoosh Kumar on 10 Comments / 2608 views

Hi All,

just wanted to know what would be best, initially for a startup to go for a “PVT. LTD Company registration ” or  “sole Proprietorship registration” ?

Thanks

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10 Comments

  1. Hi Peeyoosh,

    A Pvt Ltd is what I’d recommend, as that gives the venture a separate legal identity than the promoter himself. Its barely a cost of 20-30K, but comes with lots of benefits. Also, as a business, you’d need separate documents, n number of numbers (DIN/TIN/ PAN/TAN etc etc) which are required to do business in India. Any banker or investor would ask for these numbers and relevant documents before putting their money in (in a SEPARATE bank account in the name of the entity). Again, as a Pvt Ltd., your legal liability in the company is limited to the number of your shares in the company which is separate from your personal liability.

    On the other side, you’d need at least 1 more person to join you, as the Indian laws need at least 2 people to register a Pvt ltd (methinks that law now is changed to just 1 person under the new Companies Act – would need to confirm). 

    Further inputs invited.

    Cheers,

    Vivek

  2. Hi Peeyoosh,

    THIS video might help!

    @Vivek: Company registration no longer costs 20-30K, we at vakilsearch charge 15-16K. Really. 🙂

  3. Thanks Niraj!!! that really is helpful!! You can expect me knocking on your door soon to get my Pvt Ltd registered 🙂

  4. Hi Niraj,

    Really appreciate you reply, but would it be advisable to initially get it registered as sole proprietorship and after some time get it converted to Pvt. Ltd. ?

    to be very frank we don’t have 15-16k to spend on this. hope you understand 🙂

    Thanks 

  5. Hi Peeyosh,

    Go in for a ‘proprietorship’ firm. As a startup, your focus should be to generate business and it doesn’t really matter whether your company is a private limited or proprietorship or partnership or located in a garage because you are not going to deal with Fortune 500 companies from day one. Once you are established, you can always go in for a Private Limited company.

  6. Hi Peeyoosh,

    Unless you are looking for external investments, it would be advisable to go for a proprietorship as Pushkar suggested.. 🙂

    Once you scale or start looking for investments, you can go for Private Limited Company registration..

    All the best with your venture! 🙂

  7. Hi Vivek.

    Would definitely love to have yet another Rodinhooder in our client list..!! 🙂

  8. Hi Niraj,

    can you please get in touch with me on peeyoosh.kumar@securitythinkerz.com.

    hope to hear from you soon.

    Thanks

  9. Hi Niraj,

    I have some queries as well.Can you kindly share your email?

  10. You can mail me on niraj@vakilsearch.com 🙂

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