7 Types of Company Registration in India

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An entrepreneur in India has a choice of seven distinct company structures in which to launch their firm and a variety of strategies to utilise the registration procedure. Registration with Indian government agencies is required for every route. The Indian economy places a special emphasis on this registration, which provides both individuals and organisations with a wide range of options. There are seven different types of corporations and registrations in the Republic of India.

When forming a corporation or other organisation, it’s crucial to confirm that all legal criteria have been satisfied. The next step is to choose the best type of company registration for your operations and business concerns.

Various Types of Company Registration

The main procedure used by entrepreneurs to found or incorporate their organisation is company registration. Entrepreneurs must make sure they select a business type that is appropriate for their operations given the variety of company kinds in India. In India, the Companies Act, 2013, offers seven alternative business structure options:

  1. Private Limited Company
  2. Public Limited Company
  3. Partnerships
  4. Limited Liability Partnership
  5. One Person Company
  6. Sole Proprietorship
  7. Section 8 Company

The following are Various Types of Company Registration:

1. Private Limited Company

Registration as a private limited company is the best option if you want to use your business as a private entity. Typically, in order to protect their assets, the shareholders share equally in the responsibilities. The entire number of shares that each shareholder owns in these corporations makes up the net capital. Private limited company shares cannot be traded or transferred openly, unlike those of many other corporations.

  • A minimum of two and a maximum of fifteen directors should be on it.
  • Indian residency is required for one director.
  • There should be a minimum of two and a maximum of 200 shareholders in the firm.
  • A stable capital fee of at least Rs. 1,000,000 should be present.
  • An Indian address for its registered office is required.

Documents Necessary for Registering a Private Ltd. Company

The following papers are needed for the registration of private limited companies:

  1. The directors’ PAN card in copy
  2. Water and electricity bills (Business Place).
  3. Images of the directors (passport size).
  4. A copy of the directors’ voter identification card or Aadhaar card
  5. A copy of the rental contract (for rented property).
  6. A duplicate of the property records (for owned property).
  7. A letter of consent from the landlord.

2. Public Limited Company

One that allows the general public to acquire shares is a public limited corporation. There is no cap on how many shares can be bought, sold, or exchanged in these types of company companies. Due to the company’s shares being listed on a stock market, the shareholders are considered partial owners of the business because they may freely trade in them. These businesses must first get a certificate of registration from the RoC before starting their activities.

Following requirements must be satisfied in order to register as a public limited company, in accordance with the Companies Act of 2013:

  • Minimum of three directors
  • An Indian citizen must dwell as at least one of the directors.
  • There must be a minimum of seven stockholders, but there is no upper limit.
  • A capital fee that is authorised that is at least five lakhs
  • Must have an Indian registered office address.

Documents needed to Register a Public Limited Company

  1. The directors’ PAN card in copy
  2. Water and electricity bills (Business Place).
  3. Images of the directors (passport size).
  4. A copy of the directors’ voter identification card or Aadhaar card
  5. A copy of the rental contract (for rented property).
  6. A duplicate of the property records (for owned property).
  7. A letter of consent from the landlord.

3. Partnership Company

This kind of business is similar to a single proprietorship in some aspects. The number of participants is the main distinction between a sole proprietorship and a partnership, though. Two or more persons can form a partnership firm, and the agreement explicitly outlines each member’s responsibilities.

According to the terms of the agreement, the partners also split the earnings. In contrast, the partners are also liable for absorbing losses that are comparable to earnings. If these firms have a registered Partnership Deed, they can operate their businesses even without a licence. The Indian Partnership Act of 1932 governs the partnership corporations.

Documents required for Registration of the Partnership

  • To register a Partnership firm, the following documents are required:
  • Statement in Form 1 with the indicated fees.
  • A true copy of the Partnership Deed which has been notarized and states the following:-
    • The company’s name.
    • The nature of the company’s operations.
    • The corporation’s headquarters or primary location of business.
    • The names of any additional locations where the company does its business.
    • The date on which each partner became a partner in the company.
    • The partners’ complete names as well as their permanent addresses.
    • The time period of the existence of the company.
  • Proof of ownership or rent/lease of the business’s location.
  • A copy of each partner’s PAN card.
  • A copy of Aadhaar or voter id card

4. Limited Liability Partnership

A relatively recent trend is limited liability partnerships (LLPs), which offer the highest level of limited liability protection by completely separating corporate assets from personal assets. The amount of share capital in this firm is what the partners rely on to cover liabilities.

One of the crucial conditions for forming an LLP is that at least one partner must be a citizen of this nation and that you must maintain a minimum capital of 1,00,000.

Required Documents for Registration

  1. PAN card or identity proof such as Aadhar Card, Driver’s License, or Voter ID
  2. Bank statements, phone bills, mobile bills, and gas bills
  3. Passport size photocopy
  4. Foreigners or NRIs require a passport
  5. DSC and registered office address proof documents

5. One-Person Company

One Person Company Registration just made its debut in India. This kind of registration is typically chosen by small enterprises or startups that are owned by a single individual. Because of the liability protection provided by this registration, the owners are not even required to form partnerships.

As one person oversees all area of the organisation, it is quite simple to manage, administer, and run. It is essentially a hybrid between a sole proprietorship and a private limited company. The minimum capital need for obtaining this registration is around one million rupees. You are not eligible to register with the OPC if your firm is finance-related. Moreover, the person must be an Indian national.

Required Documents for Registration

Below are the few essential documents that need to be submitted by the company’s partners.

  1. PAN or Passport for foreigners
  2. ID proof
  3. Bank statements, electricity, gas, or phone bill
  4. Photocopy
  5. Signature of the specimen

6. Sole Proprietorship

We comprehend that a corporation with a sole proprietorship registration is one where a solitary entity is in charge of running the enterprise. We see the company and its operator as a single entity. Similar to this, the owner or operator takes on responsibility for both earnings and liabilities. The names that appear on the sole proprietorship registration will also appear on ITR filing, GST registration, and accounting, creating corporation responsibility. Almost all single-proprietorship businesses make the owner entirely accountable for all gains and risks. A one-person business known as a sole proprietorship is reasonably easy to set up. Those who own businesses or operate from home employ this registration method.

Required Documents for Registration

  1. Utility bills of the company
  2. KYC Details
  3. Company Establishment License
  4. Income Tax Data

7. Section 8 Company

Most people refer to these businesses as NGOs, or Non-Profit Organizations, because they actively take part in charitable activities. These businesses’ main goals are to promote the arts, science, and education, to protect the environment, and to aid the less fortunate.

There are just a few requirements for registering as an NGO, including the presence of two shareholders and directors. The stockholders often assume the role of directors. Contrary to many other businesses, this doesn’t need any funding. The firm should be registered at an Indian address, and any one of the directors should live in India.

Required Documents for Registration

  1. Digital Signature Certificate
  3. MOA and AOA
  4. ID verification proof
  5. Passport Size Photographs
  6. Directors data
  7. Address verification documents