Company Registration

Features Proprietorship Partnership LLP Company
Definition Unregistered type of business entity managed by one single person A formal agreement between two or more parties to manage and operate a business A Limited Liability Partnership is a hybrid combination having features similar to a partnership firm and liabilities similar to a company. Registered type of entity with limited liability to the owners and shareholders
Ownership Sole Ownership Min 2 Partners
Max 50 Partners
Designated Partners Min 2 Directors
Min 2 Shareholders
Max 15 Directors
Max 200 Shareholders

For One Person Company 1 Director

1 Nominee Director
Documentation MSME
GST Registration
Partnership Deed LLP Deed
Incorporation Certificate
MOA
AOA
Incorporation Certificate
Governance - Under Partnership Act LLP Act, 2008 Under Companies Act,2013
Transferability Non Transferable Transferable if registered under ROF Transferable
Compliance Requirements Income tax filing if turnover is more than Rs.2.5 lakhs ITR 5 Form 11
Form 8
ITR 5
ITR 6
MCA filing
Auditor's Appointment

Proprietorship :

Sole proprietorship is one of the most seasoned and most straightforward Commerce Structures to begin in India. A proprietorship is a sort of commerce that is claimed, overseen, and controlled by one individual - who is the proprietor. As the proprietorship and proprietor are one and the same, it is exceptionally simple to begin and there are exceptionally negligible compliance requirements.

As the proprietor and the business are one and the same, a proprietorship cannot have other accomplices or shareholders. Further, there is no restricted obligation assurance for the proprietor from the business exercises conducted in the sole proprietorship. Subsequently, this sort of business entity is best suited for each little trade with no more than 5 employees.
Palitronics can help you in enlisting a Sole Proprietorship, a straight forward and a proficient business structure that is perfect for solo business visionaries. With our master direction and streamlined process, you can begin your proprietorship rapidly and hassle – free. Begin your Sole Proprietorship with us and open the potential of your business ideas.

Proprietorship Registration in India :

Registering a proprietorship in India takes after an interesting and unique approach, as there isn't a committed government-established enrollment process for this business structure. Instead, a proprietorship picks up acknowledgement through tax registrations mandated by relevant laws and regulations. One significant assess enlistment is the GST (Goods and Service Tax) registrations, which must be secured beneath the proprietor's title to formalize the business's proprietorship status. This registration means that the proprietor is conducting business within the framework of a proprietorship.

Essential Licenses and Registrations for Proprietorships :

  • To run a proprietorship in India, you need important licenses and registrations, including
  • Get a Permanent Account Number (PAN) and an Aadhaar card for your business identification.
  • Register under UDYAM, which recognizes your business as a Micro, Small, or Medium Enterprise (MSME) and offers government benefits.
  • If your business exceeds specific thresholds, you must register for Goods and Services Tax (GST) to collect and pay GST.
  • Open a separate bank account for your business to manage finances smoothly.
  • Depending on your business location, register under your state's Shops and Establishment Act to follow local labor regulations

Advantages of Proprietorship

  • Easy enrollment: Sole proprietorship does not have any formal joining or disintegration process – as it is the same as the proprietor. Be that as it may, to work a business, the proprietor may have to get certain enlistments and licenses to be compliant with the laws and regulations of India.
  • Lower compliance: As most proprietorship is as it is registered with government departments like Income Tax & GST, the compliance burden will be lower. On the other hand, substances like LLP or Company enlisted with the Ministry of Corporate Affairs and have to record different statutory returns and be inspected by a Chartered Accountant each year.
  • Simplicity: As there are no accomplices, shareholders, or executives, the proprietor can effortlessly work this business with minimal documents and assent necessities. Thus, this sort of business structure is best suited for exceptionally small businesses.
  • Business choice: In a proprietorship, the proprietor takes all the business decisions and choices. There is no assent or approval required from any other individual. Thus, a proprietor can make speedy choices with respect to his business affairs.
  • Complete control: As sole proprietorship is owned or possessed as it were by the proprietor. He/she has total control over the assets, revenue and expenses and all commerce operations.

Disadvantages of Sole Proprietorship

  • Funding: This sort of business structure solely depends on one person’s investment fund, borrowings and credit history. As there are no other people included in this sort of business structure, raising funds from banks will be exceptionally difficult. Raising equity funds will not be conceivable – as this sort of business substance does not permit for benefit sharing or shareholding.
  • Personal risk: If a proprietor is incapable to pay business loans or taxes, in a proprietorship- the individual resources of the trade proprietorship can be connected or burdened. Consequently, in this sort of business structure – the proprietor will be held personally liable until all the liabilities are extinguished.
  • Business continuity: In case of death or inability of business owner, the sole proprietorship will be consequently dissolved. Hence, there will be no business continuity.
  • Growth: A proprietorship has different limitations in terms of fundraising, liability and business continuity. Hence, a very exceptionally small business those are in the unorganized sector works as proprietorships.
  • Unincorporated commerce: Sole proprietorships are unincorporated business. Hence there is no centralized database accessible to see if a sole proprietorship is active or dormant. Thus, sole proprietorships substance are generally classified as unorganized business

PAN Card for Proprietorship Firm

A proprietorship is not a isolated business entity. Thus there is no procedure to obtain a proprietor PAN card. The PAN card of the business is utilized for the proprietorship.

Obtaining GST Registration for Proprietorship

Documents Required:

  • Permanent Account Number (PAN) of Proprietor
  • Digital Signature Certificate of the Authorized Signatory
  • Consent by Proprietor for obtaining GST Registration
  • Photograph of Proprietor and Authorized Signatory
  • Bank Account Details: A scanned copy of a canceled cheque with the business entity's name, bank account number, MICR, IFSC, and branch information.
  • Declaration / Authorization to Authorized Signatory
  • For commercial purposes, the rent / lease agreement should be in the name of the proprietor.
  • Additional documents such as Aadhaar Card, Driving Licence, Passport, or Voter ID in the name of the Owner with the complete address of the premises should also be provided if the address on the ownership document (Property Tax Receipt or Municipal Khata copy or copy of Electricity Bill) is incomplete.

Obtaining UDYAM Registration for Proprietorship.

UDYAM Enrollment can be obtained online to profit different benefits accessible for little and medium measured businesses. Once the GST enrollment is obtained, the Palitronics team would offer assistance get UDYAM enlistment by submitting Aadhaar card, Container card and GST certificate to the Government.

Bank Account for Proprietorship

The bank current account for a proprietorship will be opened in the title of the Business owner utilizing his/her PAN. The owner will have to submit proof for verification for doing the business. Any two of the taking after archives can be submitted to make a current account instead of saving account in the title of proprietorship

  1. GST registration certificate
  2. Shop & Establishment Act license
  3. License issued by the Registering authority like Certificate of Practice issued by Institute of Chartered Accountants of India, Institute of Cost Accountants of India, Institute of Company Secretaries of India, Indian Medical Council, Food and Drug Control Authorities,
  4. Banks may also accept IEC (Importer Exporter Code) issued to the proprietary concern by the office of DGFT as an identity document for opening a bank account etc.

Obtaining Shops & Establishment Act License for Proprietorship

From state to state, the process for procuring a Shop and Foundation enlistment certificate changes. It is accessible both online and offline. In most of the states, Shop and Foundation Act enlistment can be done within 2-3 weeks.

Timelines for Sole Proprietorship Registration

A sole proprietorship can be registered in India through Palitronics in less than 15 days. In any case, the timelines for registration will change from case to case depending on the government and bank preparing timelines.

Proprietorship Business Activities

A proprietorship can attempt any sort of business action that an Indian individual can embrace over most sectors and industries. However, there are a few exercises like banking, insurance, financial services, lending, defence, telecommunication that require specialized endorsement. In such cases, a company is mandatorily required to get different endorsements from the Government. Consequently, proprietorship business structure as it were works for business activities that are small scale in nature.

Compliances for Proprietorship

  • Income Tax Filing: The business owner of a proprietorship will have to file personal income tax return using form ITR-3 or ITR-4.
  • Business Income: Only income tax forms ITR-3 and ITR-4 allow for declaring business income. Hence, all proprietorships will have to file form ITR-3 or ITR-4 to be compliant with the income tax regulations.
  • GST Return Filing: If a proprietorship has GST registration, GST return must be filed every month and quarter as per the scheme under which the business is registered.
  • TDS Returns: In case the proprietorship is having employees or purchasing goods/services beyond a certain threshold - tax must be deducted at source and TDS returns must be filed every quarter.
    In addition to the above, various other compliance requirements may be applicable to the proprietorship based on industry and location.

Partnership

A Partnership firm is a well known choice among entrepreneurs due to its simplicity and adaptability. It permits numerous people to come together and combine their assets, expertise, and skill to run a business. Enlisting your firm is the first step towards formalizing your partnership and guaranteeing its legitimate recognition.

At Palitronics, we get it that exploring the complexities of organization firm registration can be overwhelming. That's why we offer a comprehensive and hassle-free organization firm enrollment benefit planned to meet your needs. Whether you are a new startup or an existing unregistered association looking to formalize your business, our team of experts will guide you through each step of the enrollment process.
Contact us now to learn more and get started on your partnership firm registration journey.

Partnership Firms

A Partnership stands as one of the fundamental structures for conducting business. It materializes when two or more people collaborate to set up a business venture, sharing profits concurring to an agreed-upon ratio. This frame of business includes a wide range of exchanges, occupations, and professions. A striking advantage is that partnership firms involve generally less administrative necessities than companies.

Law Governing the Partnership Firms Registration

In India, the operation of partnership firms is represented by the Indian Partnership Act of 1932. Those who join together to make a organization firm are alluded to as partners, and the arrangement of the partnership firm is based on a legally binding assentation among individual. The agreement among the individual is commonly referred to as a "Partnership deed."

Partnership Deed

A Partnership deed is a legitimate document that traces the terms and conditions of an organization. It includes elements such as the rights and duties of partners, the distribution of profits, individual capital contributions, and the partnership's duration.
This document is significant as it helps to prevent mistaken assumptions and clashes among partners by clearly characterizing their roles and responsibility. In addition, it serves as verification of the partnership's existence and can be utilized in legitimate procedures to resolve disputes.

Partnership Firm Registration

Partnership enrollment includes the formal enlistment of a partnership firm by its partners with the registrar of the Firms. This [process happens in the state where the firm is located. It's important to note that partnership firm enrollment is not mandatory; it's optional. Partners can select to apply for enlistment at the time of shaping the firm or afterward amid its progressing operations.
For partnership enlistment to take place, two or more people must come together as partners, concur on a firm title, and make a partnership deed.

Who Can Be a Partner in India's Partnership Firms?

To be a partner in an Indian partnership firm, you require to meet these conditions:

Mental and Lawful Wellness: You must be rationally sound, not underage, not bankrupt, and not lawfully prohibited from making contracts.

Registered Partnership Firms: An enlisted partnership firm can compete with other firms or businesses.

Head of a Hindu Family: A Hindu Unified Family (HUF) pioneer can be an accomplice if they contribute their own abilities and labor to the partnership.

Companies as partners: Companies, considered legitimate substances, can moreover be accomplices if their objectives allow it.

Trustees of Particular Trusts: Trustees of private devout, family, or Hindu trusts can accomplice unless their rules expressly deny it.

Advantages of a Partnership Firm

Ease of Arrangement: Partnership firms are moderately simple and cost-effective to set up, including less customs compared to other business structures.

Ease of Arrangement: Partnership firms are moderately simple and cost-effective to set up, including less customs compared to other business structures.

Varied skill Sets: Partners can bring differing abilities, information, and assets to the business, upgrading its in general capabilities.

Shared Budgetary Burden: Partners share the monetary obligations and risk, making it more sensible for each individual.

Tax Benefits: Partnership firms are not subject to income tax themselves. Instead, benefits are taxed at the partners' tax rates, which can lead to potential tax savings.

Flexible Decision-Making: Partners permit for adaptable decision-making as partners have a say in the business's operations and direction.

Greater Access to Capital: Partners can contribute capital, and extra partners can be included to raise more funds for the business.

Disadvantages of a Partnership Firm

Unlimited Risk: Partners have boundless individual risk, meaning they are actually responsible for the firm's obligations and debts, which can put their individual assets at risk.

Limited Capital: Raising considerable capital may be challenging as it depends on the partners' contribution and potential loans.

Conflict Potential: Contrasts in opinions among accomplices can lead to clashes and prevent decision-making.

Conflict Potential: Contrasts in opinions among accomplices can lead to clashes and prevent decision-making.

Limited Development Potential: A Partnership may require more development and adaptability compared to bigger business structures.

Continuity Issues: The firm's progression may be disrupted due to a partner's death, withdrawal, or indebtedness unless arrangements are made in the partnership deed.

Tax Complexity: Partnership can include complex tax agreements, and each partner is dependable for their own tax compliance, which may require proficient assistance.

Importance of Registering a Partnership Firm

Legal standing : An enlisted partnership firm gets lawful acknowledgment. This permits partners to uphold their legally binding rights against other partners or the firm. In contrast, unregistered partnership firms confront confinements when seeking after lawful action.

Suing Third Parties : Registered firms can record a claim against third parties to implement its legally binding rights, giving lawful assurance unregistered firms do not appreciate. Unregistered firms cannot start lawful procedures against outside parties.

Claiming Set-Off: Registered firms can claim set-off or other lawful cures to uphold legally binding rights. Unregistered firms need this legitimate advantage in procedures brought against them.

Procedure for Partnership Firm Registration

  • Obtain a Digital Signature Certificate (DSC): Obtain a DSC for all partners. This electronic signature is necessary for online document signing and can be acquired from a certified agency.
  • Obtain a Designated Partner Identification Number (DPIN): After securing the DSC, partners must apply for a unique DPIN. This identification number is required for all partners and can be obtained through the MCA website.
  • Choose a Name for the Partnership Firm: Select a unique name for the partnership firm, ensuring it is not identical or similar to any existing company or LLP. It must also comply with legal naming regulations.
  • Draft the Partnership Deed: Create a comprehensive partnership deed outlining the terms and conditions of the partnership. This document should include the firm's name, partner names and addresses, business nature, profit-sharing ratio, and the partnership's duration.

Application for Registration

Partners must apply with the Registrar of Firms, including firm details, partners' names and addresses, and the duration of the firm.

  • The name of the Partnership Firm
  • The principal place of business
  • The location of any other sites where the firm carries on business
  • The date of joining of partners
  • The names and addresses of the partners
  • The duration of the firm

Obtain the Certificate of Registration

Following confirmation by the Registrar of Firms, If the registrar is satisfied with the application, a Certificate of Enlistment will be issued to affirm the partnership firm's enrollment. This certificate demonstrates the firm's enlistment with the registrar of Firms.

Apply for PAN and TAN

Apply for a Permanent Account Number (PAN) and a Tax Deduction and Collection Account Number (TAN) from the Income Tax Department. These numbers are essential for tax-related matters.

How can Palitronics help in Partnership Firm Registration?

We offer comprehensive help in Partnership Firm Enlistment, rearranging the complex prepared for you. Our experienced group gives master direction, helps in archive planning, helps with title choice, and guarantees full legitimate compliance. We take care of submitting your application to the important specialists and keep you educated with timely updates. Whether starting a new partnership or formalizing an existing one, our services are tailored to your unique needs . We do not halt at enrollment; our support continues post-registration, making a difference if you get it the progressing duties of working as an enlisted organization firm.
With Palitronics, you can certainly explore the enrollment process, knowing that your partnership is set up effectively, permitting you to concentrate on your business's development. Our cost-effective arrangements make the whole preparation hassle-free and reasonable.
Contact us today to take the first step towards a successful partnership.

One Person Company (OPC) Registration

Registering a One-Person Company (OPC) is favored among entrepreneurs who crave restricted obligation and a distinct legal identity. OPC is an interesting business structure that grants a single individual to work as a company, giving them the benefits of constrained obligation whereas holding total control. In an OPC, the person serves as both the executive and shareholder, consolidating the points of interest of a sole proprietorship with the lawful assurance of a private constrained company.

At Palitronics, we specialize in streamlining the OPC enlistment process, guaranteeing that entrepreneurs can easily explore the complexities of legal formalities. Our experienced group is committed to helping you at each step, from archive planning to recording, we offer master direction to offer assistance to you to make educated choices with respect to your OPC setup.
Contact us now and take the first step toward building your entrepreneurial dream!

Introduction to One Person Company (OPC)

One Person Company (OPC) enrollment in India was presented as a concept under the Companies Act of 2013, empowering a single person to build up a company and appreciate the combined benefits of both a sole proprietorship and a conventional company structure. This concept got to be accessible with the execution of the Companies Act in 2013.
The essential objective behind making one-person companies was to cultivate enterprise and energize the formalization of Micro, Small, and Medium Enterprises (MSMEs). Agreeing to Segment 2(62) of the Companies Act 2013, a company can be shaped with fair one executive and one part, and interests, these parts can be held by the same individual.

Eligibility Criteria

Natural Individual and Indian Citizen: As it were, a characteristic individual who is an Indian citizen can build up an OPC. Legitimate substances like companies or LLPs cannot make an OPC.

Resident in India: The promoter must be a inhabitant in India, meaning they ought to have lived in India for at least 182 days amid the past calendar year.

Minimum Authorized Capital: The OPC must have a least authorized capital of ₹100,000, the sum expressed in the company's capital clause amid the registration.

Nominee Arrangement: The promoter must appoint a nominee during the OPC's joining. This nominee would end up a part of the OPC in the event of the promoter's passing or incapacity.
Restrictions on Certain Businesses: Businesses included in monetary activities such as banking, insurances, or investments cannot be built up as OPCs.

Conversion to Private Restricted Company: If the OPC's paid-up share capital surpasses 50 lakhs or its average annual turnover surpasses 2 Crores, it must be changed over into a private restricted company to comply with the administrative prerequisites for bigger companies.

Advantages of One Person Company (OPC)

Legal Status: An OPC gets an isolated legitimate entity status, defending the person who established it from individual obligation for company losses.

Easy Fundraisings: Being a private company, OPCs discover it simpler to raise stores through wander capitalists, angel investors, and banks compared to proprietorship firms.

Reduced Compliance: OPCs appreciate certain exclusions from compliance necessities beneath the Companies Act, 2013, rearranging authoritative obligations.

Simple Incorporation: OPCs can be set up with fair one part and one chosen one, with the part moreover serving as the chief. No least paid-up capital prerequisite disentangles the consolidation process.

Efficient Management: With a single individual overseeing the OPC, decision-making is quick, driving to productive company administration without clashes or delays.

Perpetual Progression: OPCs keep up never-ending progression, guaranteeing the company's coherence indeed with as it were one member.

Disadvantages of OPC

Suitable for Little Businesses: OPCs are essentially reasonable for small-scale businesses as they can only have one member. This limits their capacity to raise extra capital as the trade expands.

Restriction on Business Activities: OPCs are limited from engaging in certain exercises, such as non-banking financial ventures and charitable objectives.

Ownership and Administration: There's a need for clear refinement between possession and administration in OPCs, as the sole member can also be the executive. This can possibly lead to moral concerns or clashes of interest.

Required Documents

  • Memorandum of Association (MoA)
  • Articles of Association (AoA)
  • The nominee's consent, along with their PAN card and Aadhaar card, must be submitted via Form INC-3.
  • Proof of Registered Office
  • The proposed director should furnish a declaration in Form INC-9 and their consent in Form DIR-2.
  • A declaration by a qualified professional certifying that all necessary legal compliances have been adhered to.

Registration of One Person Company (OPC) in India

In India, the enlistment of a One Person Company (OPC) is encouraged through the SPICe+ (Streamlined Proforma for Joining Company Electronically Additionally) shape, which has supplanted the past application shapes for company incorporation.

Part A: This beginning area of the SPICe+ form is committed to securing endorsement for the wanted company title and applying for the Director Identification Number (DIN) or Permanent Account Number (Dish) for the proposed director.

Part A: This beginning area of the SPICe+ form is committed to securing endorsement for the wanted company title and applying for the Director Identification Number (DIN) or Permanent Account Number (Dish) for the proposed director.

Part B: The consequent fragment, known as Part B, involves outfitting incorporation-related points of interest. Here, fundamental data such as the enlisted office address of the OPC, subtle elements approximately share capital, particulars of the director, and data approximately the shareholder is provided.

Here are the steps involved in the OPC registration.

Obtain a Digital Signature Certificate (DSC): Secure a Digital Signature Certificate (DSC) for the intended director of the OPC. The DSC is utilized for electronically signing crucial documents.

Obtain Director Identification Number (DIN): Acquire a Director Identification Number (DIN) for the proposed director from the Ministry of Corporate Affairs (MCA).

Name Reservation: Apply for name reservation through the MCA portal using Form SPICe+ (Part A). Ensure that the chosen name for your company is distinct and does not resemble any existing company or trademark.

Prepare MOA and AOA: Draft the Memorandum of Association (MOA) and Articles of Association (AOA) for your company. These documents define the company's objectives and internal rules.

File the Forms: File the necessary forms with the MCA for OPC registration. Attach the relevant documents to the SPICe+ form, including MOA, AOA, declarations, proof of the registered office, nominee appointment, and other documents as required by the MCA.

Certificate of Incorporation: Upon approval by the ROC and verification of compliance requirements, the ROC will issue a Certificate of Incorporation, signifying the successful registration of your One Person Company. Notably, the PAN number (Permanent Account Number) and TAN (Tax Deduction and Collection Account Number) are generated automatically during the incorporation process, eliminating the need for separate applications.

With this Certificate of Incorporation, your OPC is officially recognized and ready to commence its operations in India.

Why Palitronics for OPC Registration?

Palitronics is the perfect accomplice for One Person Company (OPC) enrollment for a few compelling reasons. With a master group in company enlistment and a profound understanding of the administrative scene, Palitronics rearranges the regularly complex OPC enlistment process.
We offer master direction, from title reservation to report planning and accommodation. Our commitment to exactness and compliance ensures that your OPC enrollment follows all lawful necessities, whereas our devoted bolster group is promptly accessible to address any inquiries or concerns you may have.

Get started now and embark on your entrepreneurial journey with confidence!

  • Post-Incorporation Formalities for OPC
  • Following the effective consolidation of a One Person Company (OPC), particular compliance customs must be followed to, associated to those appropriate to private restricted companies. Our specialists are prepared to help you in satisfying OPC compliance prerequisites, guaranteeing that your business remains in full lawful compliance

Limited Liability Partnership (LLP)

Limited Liability Partnership (LLP) is a modern and beneficial business structure. Mixing the qualities of organization elements and the security of limited liability, an LLP offers a flexible stage for business people to collaborate and improve confidently.
Getting your LLP enlisted in India is super simple with Palitronics. Numerous businesses believe us

to offer assistance them enlist their Limited Liability Partnership and guarantee they take after the rules. Our group of specialists will direct you through the online enrollment process from starting to conclusion. It's the quickest and cheapest way to enlist your LLP – all you have to do is fair reach out to us. Begin presently and set yourself up for a fruitful trade future with LLP registration.

What is an LLP?

A Limited Liability Partnership (LLP) is a unique type of business setup that blends a partnership's and a company's features. In an LLP, partners enjoy limited liability, similar to shareholders in a company, while also benefiting from the flexibility and simplicity of a partnership. This arrangement grants the LLP its legal identity, allowing it to take legal actions and be subject to legal actions separately from its partners.
LLPs have become popular among entrepreneurs in various industries because they shield partners' assets and have more straightforward regulatory requirements than traditional corporations. The concept of LLP was introduced in India in 2008 and is governed by the Limited Liability Partnership Act, offering a dependable and adaptable option for businesses of all sizes.

LLP Registration Prerequisites and Eligibility Conditions

Minimum of Two Partners: Establishing a Limited Liability Partnership in India necessitates a minimum of two partners, with no upper threshold on the maximum number of partners.

Designated Partners: Within the partnership framework, at least two selected partners are obligatory, and they must be natural individuals. At least one of these designated partners must also maintain residency in India.

Nomination for Body Corporate Partner: If a body corporate assumes the role of a partner, the designation of a natural person must act as its representative.

Agreed Contribution: Each partner is required to contribute the shared capital of the LLP, as stipulated and agreed upon.

Minimum Authorized Capital: The LLP is mandated to possess an authorized capital of at least Rs.1 lakh.

Indian Resident Designated Partner: At least one designated partner of the LLP must hold a resident status in India.

Note: By satisfying these prerequisites, you can progress with the registration of an LLP in India and avail the advantages bestowed by this business structure.

Characteristics of LLP

Legal Identity: Like big companies, an LLP has a separate legal identity. This means it's seen as its own "person" regarding rights and responsibilities, separate from those who own it.

At Least Two Partners: An LLP needs at least two people to start it. This teamwork helps in setting up the business and working together.

No Partner Limit: Unlike some other businesses, there's no highest number of partners an LLP can have. This makes it easy to grow and bring in more partners.

Two Designated Partners: An LLP has to have at least two "main" partners. These people must be real individuals, and at least one should live in India.

Limited Responsibility: One big plus of an LLP is that if something goes wrong, each partner is only responsible for what they put in. So, personal things are safe from business problems.

Cost-Effective Start: Starting an LLP costs less than setting up a big company. This makes it a great option for smaller businesses.

Less Rules to Follow: LLPs don't have to follow as many rules and regulations as big companies. This means less paperwork and less to worry about.

No Minimum Money Needed: Unlike big companies, you don't need a certain amount to start an LLP. Partners can invest what they can afford.

Advantages of LLP: -

Own Legal Identity: An LLP is like its own person, just like big companies. This helps people trust and work with it, as it can do legal things independently.

Less Risk for Partners: LLP partners are only responsible for what they put in. They don't have to pay for all the debts or losses, which is good for their reputation.

Saves Money and Time: Starting an LLP costs less and has fewer rules than big companies. There's less paperwork to do every year.

No Fixed Money Needed: You don't need much money to start an LLP. Partners can put in whatever amount they want.

Disadvantages of LLP: -

Getting in Trouble for Not Following Rules: Even though LLPs have fewer rules, they can get big fines if they don't follow them on time. Even if an LLP doesn't do anything in a year, it still needs to tell the government or get fined.

Ending an LLP: An LLP needs at least two partners. It must stop if it has fewer than two partners for six months. Also, it might have to close if it can't pay its debts.

Hard to Get Big Money: LLPs don't work like big companies where people invest money and become owners. This makes it tricky to get a lot of money from investors.

LLP Name Structure

Choose a unique name that is not used by other businesses. This makes approval easier and establishes your identity. Include words that clearly describe what your business does. This helps people understand your services or products.

End your LLP name with "LLP" or "Limited Liability Partnership." This is necessary to show your business structure

Documents Required for LLP Registration

  • PAN Card/ID Proof of Partners: Address Proof of Partners: Partners can submit the following documents: Voter's ID, Passport, Driver's License, or Aadhar Card.
  • Residence Proof of Partners: Partners need to provide recent documents such as a bank statement, telephone bill, mobile bill, electricity bill, or gas bill from the last 2-3 months.
  • Passport-size Photograph: Partners should provide a passport-size photograph with a white background.
  • For Foreign Nationals and NRIs: Foreign nationals and NRIs intending to partner in an Indian LLP should submit their passport. Additionally, proof of address, such as a driving license, bank statement, residence card, or any government-issued identity proof containing the address, is required.
  • Proof of Registered Office Address: This includes the landlord's rent agreement and a no-objection certificate if the office space is rented. A recent utility bill (gas, electricity, or telephone) with the complete address and owner's name (dated two months or older) should also be submitted.
  • Digital Signature Certificate (DSC): At least one designated partner must have a DSC for digitally signing documents.

Procedure for LLP Registration

  • Obtain a Digital Signature Certificate (DSC): All proposed partners of the LLP must obtain a Digital Signature Certificate (DSC) since all government filings require digital signatures.
  • Obtain Director Identification Number (DIN): Partners without a DIN need to apply for one. The Director Identification Number (DIN) is a unique identification number assigned to individuals aspiring to become directors or designated partners in LLPs.
  • Choose a Name for the LLP: Select a unique and suitable name for your LLP, adhering to Ministry of Corporate Affairs guidelines.
  • Form for Incorporation of LLP (FiLLiP): This form collects essential information about the proposed LLP, partners, LLP agreement, and registered office address. It includes a declaration from partners consenting to act as designated partners and comply with LLP regulations.
  • Draft LLP Agreement: Create the LLP Agreement outlining partner rights, duties, and obligations. This agreement must be notarized and filed with the Ministry of Corporate Affairs within 30 days of incorporation.
  • Obtain a Certificate of Incorporation: Once forms and documents are filed and verified, the Registrar of Companies (RoC) will issue the Certificate of Incorporation, officially recognizing the LLP's existence.
  • Apply for PAN and TAN: After obtaining the Certificate of Incorporation, apply for the Permanent Account Number (PAN) and TAN for the LLP.

You can successfully register your LLP and embark on your entrepreneurial venture by following these steps diligently.

Effortless LLP Registration Made Possible with Palitronics

Experienced Professionals: Our skilled team knows the ins and outs of LLP registration. We'll provide you with accurate information, ensuring you grasp each step.

Name Availability: We'll help you check if your desired LLP name is available and reserve it according to the rules.

DSCs and DINs: We'll assist you in getting Digital Signature Certificates (DSCs) and Director Identification Numbers (DINs) – necessary for the process.

LLP Agreement: Our experts will aid in drafting the LLP Agreement, ensuring it's legally sound. We'll also manage to file the required documents with the authorities, keeping things accurate and compliant.

PAN and TAN Application: We'll simplify the application process for your LLP's Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN).

Customer Support: We're here for you. Our customer support will address your questions, ensuring your journey is seamless.

Timely Updates: You'll receive timely updates on your LLP registration progress, keeping you informed every step of the way.

Private Limited Company

Setting up a business in India frequently includes choosing a private limited company as a favored alternative. This structure offers shareholders limited liability protection whereas setting particular possession limitations. In the case of an LLP, partners supervise the administration. Private limited company enlistment permits for a clear refinement between directors and shareholders.

We offer a cost-effective benefit to encourage the consistent enlistment of your company in India. We handle all legitimate facilities, guaranteeing strict compliance with the Ministry of Corporate Affairs (MCA) regulations.

What is a private limited company?

In India, a private limited company is a privately held entity with limited liability, and it positions among the nation's most favored business structures. This popularity is fundamentally ascribed to its various advantages, including limited liability protection, ease of arrangement and maintenance, and its status as a particular legal entity. A private limited company appreciates legal partition from its proprietors and requires a minimum of two individuals and two directors for its operation.

Here are the key characteristics of a private limited company in India:

Limited Liability Assurance: Shareholders of a private limited company are liable only to the extent of their shareholding. Their assets stay defended, indeed in cases of money related misfortunes caused by the company

Separate Legal Entity: A private company has its claimed particular legitimate personality. It can possess property, engage in contracts, and start or protect lawful activities beneath its one of a unique name.

Minimum Number of Shareholders: A private company must have at least two shareholders and cannot surpass 200 shareholders.

Minimum Number of Directors: A private limited company requires a minimum of two directors. At least one of these directors must be an Indian citizen.

Minimum Share Capital: The company must keep up a least paid-up capital of Rs. 1 lakh or a higher sum as specified.

Name of the Firm: The private restricted company's title must conclude with the words "Private Limited."

Restrictions on Share Exchange: The right to exchange offers inside a private limited company is confined. Shares can be exchanged with the endorsement of the Board of Directors or taking after the company's Articles of Association.

Prohibition on Public Invitation : Private limited companies are denied from inviting the public to subscribe to their offers or debentures.

Compliance Requirements: Private limited companies are committed to follow different lawful and regulatory obligations, including keeping up appropriate financial records, conducting annual general gatherings, and filing annual returns with the ROC.

Types of Private Limited Companies:

  • Company Limited by shares: Shareholders' liability is restricted to the ostensible share sum specified in the Memorandum of Association
  • Company Limited by Guarantee: Member liability is limited to the sum of ensure indicated in the Memorandum of Association. This ensure is conjured as it were amid winding up.
  • Unlimited Companies: Individuals of unlimited companies have boundless individual liability for the company's debts and liabilities. In any case, they are still considered an isolated legitimate entity, and individual members cannot be sued.

Advantages of a Private Limited Company

  • Limited Obligation: Shareholders' responsibility is confined to the degree of their capital contribution, safeguarding individual assets from the company's monetary obligations and liabilities.
  • Distinct Legitimate Identity: A Private limited Company has an independent legal identity distinct from its proprietors. It has the capacity to own assets, lock in in legally binding understandings, and start or guard lawful activities beneath its possess name.
  • Continuous Existence: The company's presence holds on independent of shifts in shareholders or directors. Its presence is not unexpected upon the life expectancy of its associates.
  • Ease of Funding: Raising capital by issuing shares to investors, venture capitalists, or angel investors is less demanding. This structure draws in outside investment.
  • Tax Benefits: Private Limited Companies may qualify for different tax benefits and exclusions, making them tax-efficient entities.
  • Credibility and Trust: Having "Pvt. Ltd." in your company title frequently ingrains more certainty and believe in clients, suppliers, and partners.

Disadvantages of a Private Limited Company

  • Compliance Burden: Confront administrative requests, counting financial reporting, filings, and audits.
  • Complex Setup: Process and cost for overseeing are higher than more shallow structures.
  • Share Limits: Limited share exchanges; max 200 shareholders in India.
  • Public Disclosure: Financial related data is freely distinguishable, affecting privacy.
  • Exit Complexity: Selling or taking off is more complicated than with other structures.
  • Slower Choices: The association of shareholders and directors may slow choices.

Requirements for Registering a Company in India:

  • Directors and Members: At least two directors and 200 individuals are required for Private Limited Company Enlistment in India, as per the Companies Act of 2013. Directors must have an Executive Recognizable proof Number (Clamor)Director Identification Number issued by the Ministry of Corporate Affairs (MCA). At least one director must be an Indian inhabitant, having spent 182 days in India in the past calendar year.
  • Company name: When selecting a title for a private limited company, two components must be considered: The title should reflect the vital activities of the business.
  • Address of the Registered Office: After the company enrollment process, the company must give the permanent address of its enlisted office to the company registrar. Business operations occur in this office, and all important company documentation is maintained.

Company Registration Process

  • Company Enlistment Process
  • Acquire a Digital Signature Certificate (DSC): Each executive and shareholder must secure a Digital Signature Certificate (DSC) issued by the Controller of Certification Organizations (CCA). This includes giving basic subtle elements such as passport-sized photographs, PAN, Aadhaar Card, phone number, and e-mail address. Remote nationals ought to too outfit notarized and apostilled archives if applicable.
  • Director Identification Number (DIN): Obtain a Director Identification Number (DIN) if you expect to be a director in the company. DIN is essential for directors and needs to be given in the enlistment form.
  • Name Reservation for the Company (SPICe+ Part A): Start by completing the SPICe+ Part A shape to secure a unique company title. This involves selecting the company type, class, category, and sub-category, indicating the essential division of mechanical action and advertising a comprehensive trade depiction. You'll be required to propose two names for approval.
  • Submission of Company Subtle elements SPICe+ Part B): Give comprehensive data concerning capital, enlisted office address, endorser and directors' subtle elements, stamp duty, PAN and TAN application, and necessary attachments. Guarantee compliance with the Companies Act 2013 and get digital signatures from helping professionals.
  • Preparation and submission of Joining forms (SPICe+ MOA and AOA): Draft the Memorandum of Association (MOA) and Articles of Association (AOA) containing significant company points of interest. Get digital signatures from supporters and experts some time recently submitting these reports to the MCA for approval.
  • Additionally, record the AGILE-PRO-S frame to enroll for GST, EPFO, ESIC, a bank account, and a shop and foundation license (which may be state-dependent).

Certificate of Incorporation: Upon successful document verification, the MCA will issue the Certificate of Incorporation (COI) with the Company Identification Number (CIN), PAN, and TAN.

Document Checklist:

  • For Indian Nationals: Self-attested PAN card copy, passport-size photo, Aadhaar Card, proof of identity, and address proof.
  • For Foreign Nationals: Notarized documents, passport-size photo, passport, and address proof.
  • Registered Office Documents: Proof of business address, copy of the rent agreement (if applicable), and owner's no objection certificate.

Post-Registration Compliance

Following incorporation, adhering to post-registration company compliances is essential to streamline company operations and define the roles and responsibilities of directors and shareholders.

Register Your Company through Palitronics

  • Palitronics specializes in Company Registration services in India, giving comprehensive direction and support all through the enlistment process. Our team of experts offers master interview custom fitted to your particular necessities and business goals.
  • Selecting the fitting title for your company is basic, and Palitronics specialists will help you in choosing a one of a kind and fitting title that adjusts with ROC rules. We'll conduct a title accessibility look and encourage the reservation of your chosen title, reflecting your business identity.
  • Compiling the fundamental documentation for company enlistment can be overpowering, but our specialists will handle this task effectively. We will direct you in amassing all required documents, ensuring exactness and compliance.
  • To enroll in a private constrained company, chiefs must get a Digital Signature Certificate and Directors Identification Number (DIN). We will direct this handle to guarantee you have the certifications for consistent registration.
  • By choosing Palitronics for your Company Enlistment needs, you can be certain that your private limited company enlistment will be overseen professionally and successfully. We point to simplify the process, permitting you to concentrate on your business goals whereas we address the lawful necessities. Set out on your entrepreneurial journey with confirmation by enrolling your company through Palitronics.

Section 8 Company Registration

A Section 8 Company is a non-profit organization that points to advance charitable exercises, art, science, education, and sports. The benefits of such companies are utilized for advancing these goals and are not dispersed among the Company's members.

At Palitronics, we give end-to-end services for enlisting section 8 companies in India. Our group of specialists offers hassle-free and proficient administrations to offer assistance to build up a Area 8 company rapidly and productively.

Definition of Section 8 Company – Companies Act, 2013

According to the Companies Act 2013, a Section 8 company is defined as an organization whose objectives are to advance art, commerce, science, investigation, education, sports, charity, social welfare, religion, environmental protection, or other comparative exercises objectives. These substances utilize their benefits to accomplish their mission and do not disseminate profits to their shareholders.

Overview of Section 8 Company Registration:

A Section 8 Company is a sort of organization built up to advance non-profit exercises, such as education, social welfare, environment conservation, arts, sports, charity, and more. This takes after the arrangements of the Companies Act 2013.

The basic reason for enrolling a Section 8 Company is to empower non-profitable objectives, including but not restricted to exchange, arts, commerce, education, charity, natural security, sports investigate, and social welfare. To enlist a Section 8 Company, a minimum of two directors are required, and there is no prerequisite for a least paid-up capital to set up such a company.

Key Points about Section 8 Company

  • In India, Non-Governmental Organizations (NGOs) can be enrolled beneath the Registrar of Societies or as a non-profit entity under section 8 Company of the Companies Act, 2013.
  • Profit produced by Section 8 Companies cannot be utilized for purposes other than charitable targets and cannot be dispersed among shareholders.
  • Section 8 Companies are comparative to the recent Section 25 Company under the Company Act 1956. As per the prevailing Company Act, these are presently recognized as Section 8 Companies.
  • Section 8 Companies are required to comply with the arrangements of the Companies Act 2013. They are ordered to keep up books of accounts, file returns with the Registrar of Companies (ROCs), and comply with GST and IT Act.
  • Any changes to the constitution documents like the Articles of Association (AOA) and Memorandum of Association (MOA) require the government's consent.

Benefits of Opening a Section 8 Company in India:

  • Tax Exemption: Section 8 companies enlisted under section 12AA of the Income Tax Act are qualified for a 100% charge exception, as they utilize their benefits for charitable purposes. This is a noteworthy advantage as the benefits created by such entities are non-taxable.
  • No Minimum Capital Necessity: Not at all like open restricted companies, Section 8 entities do not have a minimum capital necessity. They can alter their capital structure agreeing to their development, giving them more flexibility.
  • Separate Legitimate entities: Section 8 companies have an isolated lawful personality and never-ending presence, fair like other enlisted companies. This increments their validity and gives them more independence and legitimate standing.
  • Increased Validity: Section 8 companies are subject to strict legitimate compliance systems, improving their validity with respect to lawful standing. Not at all like NGOs and trusts, Segment 8 entities take after exacting compliance post-registration, making them more trustworthy.

A Section 8 company in India offers numerous benefits, including tax exemption, no minimum capital requirement, no need to pay stamp duty, separate legal identity, increased credibility, and no title required. These advantages make Section 8 companies attractive for entrepreneurs looking to start a business with a charitable or social cause.

Eligibility Criteria for Incorporation of the Section 8 Company

  • An Indian national or Hindu Undivided Family (HUF) can incorporate a Section 8 Company.
  • The entity must have at least one director.
  • The primary object of the Section 8 Company should be related to promoting art and science, sports, charitable activities, education, or providing financial assistance to individuals from lower-income groups.

Mandatory legal requirements for Section 8 Company

  • Number of Directors: A least of two directors is required if the Section 8 entity intends to work as a private limited company. In any case, a least of three directors are required if the entity points to work as a public limited company.
  • Number of Individuals: If the Section 8 Company points to work as a private limited company, the number of individuals is capped at 200 by the Ministry of Corporate Affairs (MCA). In any case, there are no such constraints for Section 8 entities with a business structure like a public limited company.
  • Capital Requirement and Title: According to the Companies Act 2013, Section 8 entities are not required to keep up a least paid-up capital. Additionally, NGOs working as Section 8 substances are not committed to fasten terms like private restricted or restricted in their name.
  • Company Objects: Only entities with non-profit goals are qualified for section 8 enlistment. The Memorandum of Association and Articles of Association must clearly state such objectives for which the Company is set up. Any benefits the section 8 entities create must be utilized for charitable purposes or reinvested in the entities. The benefit of section 8 entities is not accessible to its individuals in any shape. These legitimate requirements guarantee that Section 8 companies work with straightforwardness and the aiming reason of advancing social welfare.

Documents Required for Section 8 Company Incorporation

  • Articles of Association (AOA) and Memorandum of Association (MOA)
  • Declaration by the first director(s) and subscriber(s) (an affidavit is not required)
  • Proof of office address, such as a copy of utility bills like electricity, water, or gas bill
  • Copy of the certificate of incorporation (COI) of an overseas corporate body (if any)
  • A resolution passed by the promoter company
  • Consent of Nominee (INC-3)
  • Residential and identity proof of nominees and subscribers
  • Applicant's identity and residential proof
  • Digital Signature Certificate (DSC)
  • Declaration of unregistered companies.

Section 8 Company Incorporation Process

  • ➔ Obtain Digital Signature Certificate (DSC): The first step is to obtain a Digital Signature Certificate (DSC) for the proposed directors of the Section 8 Company. This certificate is required for the online filing of documents with the Ministry of Corporate Affairs (MCA). Form DIR-3 is used for obtaining the DIN and should be filed along with the DSC of the proposed directors.
    Forms to be used: DIR-3, DSC
  • ➔ Obtain Director Identification Number (DIN): After obtaining the DSC, the next step is to apply for a Director Identification Number (DIN) for the proposed directors. The DIN number is a unique identification number issued by the MCA to individuals who wish to be directors of a company in India.
    Forms to be used: DIR-3
  • ➔ Reserve the Company Name: The next step is to reserve the name of the proposed Company with the MCA. The Section 8 company name should be unique and not be similar to any existing company name. Form INC-1 is used for reserving the company name.
    Forms to be used: INC-1
  • ➔ File the Application for Incorporation: After the company name is approved, the next step is to apply for Section 8 Company incorporation. The application for incorporation is filed in Form INC-32 along with the Company's Memorandum of Association (MOA) and Articles of Association (AOA).
    Forms to be used: INC-32, MOA, and AOA
  • ➔ Obtain a License for Section 8 Company: Once the application for incorporation is approved, the next step is to obtain a license for the Section 8 Company. Form INC-12 is used for obtaining the license. It should be filed along with the necessary documents.
    Forms to be used: INC-12
  • ➔ Obtain a Certificate of Incorporation: After obtaining the license, the MCA issues a Certificate of Incorporation in Form INC-16. This certificate confirms the incorporation of the Section 8 Company.
    Forms to be used: INC-16

In summary, the forms used for Section 8 Company registration are DIR-3, DSC, INC-1, INC-32, MOA, AOA, INC-12, and INC-16.

Donations/Funding of Section 8 Company

  • Foreign contributions are permissible only if FCRA registration is obtained, which can be applied for three years after registration.
  • If immediate foreign contributions are required, prior permission from the commissioner can be requested.
  • Equity funding can be achieved by releasing new equity shares at a premium price. Domestic subsidies have no restrictions, but it is vital to establish a comprehensive system to prevent money laundering.

Streamline Section 8 Company Registration with Palitronics

Palitronics is a trusted partner for entrepreneurs and organizations looking to obtain Section 8 company registration in India. With our expertise and seamless online platform, Palitronics simplifies the complex process of registering a Section 8 company, ensuring that all legal formalities are met. Our dedicated team of professionals guides clients through the entire registration procedure, from documentation to approval, and helps you establish non-profit organizations that can work towards social welfare and charitable activities.

Contact us now to begin your Section 8 company registration journey.

Nidhi Company

A Nidhi Company in India is a non-banking financial company (NBFC) that operates under the regulatory framework of the Nidhi Rules, 2014. It is governed by Section 406 of the Companies Act, 2013.

Operating as a public limited company, its primary purpose is to encourage thrift and savings among its members while facilitating financial assistance through lending.
If you're interested in registering a Nidhi Company in India and need assistance, feel free to reach out to Palitronics for guidance and support. We can help you navigate the registration process and ensure that your Nidhi Company complies with all the necessary regulations. Get started on your journey towards establishing a Nidhi Company today!

What is Nidhi Company?

A Nidhi Company is a company that primarily deals with managing deposits from and providing loans to its members, who are also shareholders. The main purpose of a Nidhi Company is to promote thrift and savings among its members while offering financial assistance through lending.
Nidhi Companies in India have specific exemptions and relaxed regulations when it comes to their annual compliance requirements and tax assessments, making them a unique financial institution designed to benefit their members mutually.
The legal framework governing Nidhi Companies in India consists of Section 406 of the Companies Act, 2013, the Companies (Nidhi Companies) Rules of 2014, and Chapter XXVI of the Companies Rules, 2014.

The Purpose and Nature of Nidhi Companies

Nidhi Companies serve a distinct purpose in the Indian financial landscape, primarily focused on promoting savings among their members. These companies are unique in that they can accept deposits from and offer loans exclusively to their members. The term "Nidhi" in Nidhi Company, derived from Hindi, signifies "treasure."

Nidhi Companies fall within the category of Non-Banking Financial Companies (NBFCs). While they do not fall under direct regulation by the Reserve Bank of India (RBI), the RBI holds the authority to issue directives regarding their deposit acceptance activities.
What sets Nidhi Companies apart is their exclusive engagement with their members, who are also shareholders. This exclusive relationship grants them exemptions from certain core provisions of the RBI Act and other regulatory guidelines that apply to traditional NBFCs. As a result, a Nidhi Company is a legally sound entity for accepting deposits and providing loans exclusively to a specific group of members, making it a unique financial institution in India.

Benefits of Nidhi Company

  • Easy Formation: Nidhi Companies boast a straightforward and hassle-free formation process with minimal requirements, making it accessible for those looking to establish such entities.
  • Non-Compliance with RBI: Nidhi Companies are not bound by the Reserve Bank of India (RBI) guidelines, allowing them to set their own operational rules and regulations.
  • Lower Risk: Transactions involving lending, borrowing, or depositing are carried out by members of the Nidhi Company, reducing financial risks and ensuring a sense of security within the community.
  • Economic Registration: The registration process for a Nidhi Company is cost-effective when compared to other Non-Banking Financial Company (NBFC) registration procedures, which facilitates easier access to business loans and financing options.
  • Savings Promotion: Nidhi Companies play a pivotal role in promoting a culture of saving among the Indian population, thereby contributing to financial prudence.
  • Net-Owned Funding System: Nidhi Companies typically adopt a cost-effective net-owned funding system, which can enhance their business growth prospects by efficiently utilizing their own resources and funds.

Restrictions on Nidhi Companies

  • ➔ Advertise for deposits from the public.
  • ➔ Get involved in chit funds.
  • ➔ Provide leasing or hire-purchase financing.
  • ➔ Run lotteries.
  • ➔ Offer insurance services.
  • ➔ Sell, mortgage, or use assets as security.
  • ➔ Partner with others for lending and borrowing.
  • ➔ Take deposits or lend money to people who aren't their members.
  • ➔ Issue certain types of shares or debt instruments.
  • ➔ Exceed a limit on the value of shares.
  • ➔ Open current accounts for members (though savings accounts are fine).
  • ➔ Lend to or take deposits from corporations.
  • ➔ Pay commissions or fees for attracting deposits.
  • ➔ Do any business beyond borrowing and lending to members.
  • ➔ Get involved in hire-purchase financing.
  • ➔ Pay fees for loans to brokers.

Documents Required for Nidhi Company Registration in India

  • ➔ Directors Identification Number (DIN)
  • ➔ PAN Number (Permanent Account Number)
  • ➔ Residential proof and address proof
  • ➔ Photographs of the proposed directors and members
  • ➔ Identification documents like Aadhar card
  • ➔ Proof of the registered business place, such as a rent agreement or lease
  • ➔ Ownership proof of the business place
  • ➔ NOC (No Objection Certificate) if required
  • ➔ Memorandum of Association (MOA)
  • ➔ Articles of Association (AOA)

Nidhi Company Incorporation Requirements

  • Minimum Shareholders or Members: A minimum of 7 members is required to initiate the registration process.
  • Minimum Directors: You must have a minimum of 3 directors to form the company.
  • Minimum Capital: A minimum capital of Rs. 5 lakhs is essential to kickstart your Nidhi Company.
  • Director Identification Number (DIN): Directors must obtain a Director Identification Number (DIN).
  • Number of Directors: At least three directors are necessary to establish the company.
  • No Preference Shares: Issuing preference shares is not permitted.
  • Focus on Savings: The Company’s primary objective should be to promote the habit of saving by receiving deposits from and lending to its members exclusively for their mutual benefit.

Requirements After Registration

  • Membership Quota: By the end of the first year, your Nidhi Company must have at least 200 members or shareholders.
  • Net Owned Funds (NOF): Your company's NOF should exceed Rs. 10 lakhs.
  • NOF to Deposit Ratio: The NOF to deposit ratio should be greater than 1:20.
  • Unencumbered Deposits: Unencumbered deposits must be over 10% of outstanding deposits.

Nidhi Company Registration Procedure

  • Applying for DIN and DSC: Directors of the Nidhi Company must apply for Director’s Identification Number (DIN) and acquire a Digital Signature Certificate (DSC). DIN is issued by the Ministry of Corporate Affairs (MCA), while DSC is essential for all e-filing processes. Directors with pre-existing DIN and DSC can bypass this step.
  • MoA & AoA: Draft the Memorandum of Association (MoA) and Articles of Association (AoA), specifying the primary purpose of establishing the Nidhi company. These documents, along with a subscription statement, need to be filed with the Registrar of Companies (ROC).
  • Name Approval Process: Propose three preferred names for the Nidhi Company to the MCA. The MCA will choose one name for approval. The selected name must be unique and not currently in use. Once approved, it remains valid for 20 days.
  • Application for Registration: After securing name approval, directors must submit an application for registration. This application includes the submission of the Articles of Association (AOA) and Memorandum of Association (MOA).
  • Certificate of Incorporation (CIN): Typically, it takes 15-20 days for the relevant authority to issue the Certificate of Incorporation for the Nidhi Company. This certificate also provides the unique Company Identification Number (CIN) for the company.
  • PAN, TAN, and Bank Account: Apply for the Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN). Subsequently, open a bank account for the Nidhi Company by submitting the Certificate of Incorporation, MoA, AoA, and PAN

Compliance for Nidhi Company

  • NDH-1 Form: Submitting a list of members within 90 days at the end of each financial year using this form.
  • NDH-2 Form: If your Nidhi Company has yet to reach a membership of 200 in its first financial year, you can request an extension from the Ministry of Corporate Affairs (MCA) using this form.
  • NDH-3 Form: Filing a half-yearly return apart from the NDH-1 Form.
  • Annual Returns with ROC: Filing annual returns with the MCA using Form "MGT-7."
  • Financial Statements: Submitting the company's financial statements and related documents annually in Form "AOC-4."
  • Income Tax Returns: like other businesses, Nidhi Companies must file annual income tax returns by September 30th of the following fiscal year.

Documents Required For Nidhi Company

  • ➔ Recent Utility Bill
  • ➔ Business Place

Nidhi Company FAQ's

How many people are required to register a Nidhi Company?
What are the requirements to be a Director?
The Director needs to be over 18 years of age and must be a natural person.
Is an office required to start a Nidhi Company?
An address in India where the registered office of the Company will be situated is required. The premises can be commercial/industrial/residential where communication from the MCA will be received.
Do I have to be present in-person to incorporate a Nidhi Company?
No, you don’t have to be present at our office or appear at any office for the registration of a Nidhi Company.
What is a Digital Signature Certificate?
A Digital Signature establishes the identity of the sender or signee electronically while filing documents through the Internet. The Ministry of Corporate Affairs (MCA) mandates that the Directors sign some of the application documents using their Digital Signature.
What are the documents required for Nidhi Company registration?
Identity proof and address proof are mandatory for all the proposed Directors of the Nidhi Company. PAN Card is mandatory for Indian Nationals. In addition, the landlord of the registered office premises must provide a No Objection Certificate for having the registered office in his/her premises and must submit his/her identity proof and address proof.
How long will it take to incorporate a Nidhi Company?
Palitronics can incorporate a Nidhi Company for 20-30 days. The time taken for registration will depend on the submission of relevant documents by the client and the speed of Government Approvals. To ensure speedy registration, please choose a unique name for your Company and ensure you have all the required documents prior to starting the registration process.
How long is the registration of the Company valid?
Once a Nidhi Company is incorporated, it will be active and in existence as long as the annual compliances are met regularly. A Nidhi Company must have a minimum of 200 shareholders and comply with other criteria within one year of incorporation. In case, annual compliances are not complied with, the Nidhi Company will be asked to refund the deposits.
What is DIN?
Director Identification Number is a unique identification number assigned to all existing and proposed Directors of a Company. It is mandatory for all present or proposed Directors to have a Director Identification Number. Director Identification Number never expires and a person can have only one Director Identification Number.
Who regulates the Nidhi Companies?
The Ministry of Corporate Affairs regulates Nidhi Company and is also accountable for Nidhi Company Registration.
Can Nidhi Companies issue debt securities or preference shares?
No Nidhi Companies cannot issue debentures, preference shares, or any other kinds of debt securities.
Can Nidhi Companies operate in another state?
No, Nidhi Company cannot perform its operations outside the boundaries of the state in which the registration has taken place.
Can Nidhi Companies issue unsecured loans
No, Nidhi Company cannot issue unsecured loans. However, it can issue secured loans to its members.

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