Advantages of Private Limited Registration: –
Perpetual Succession – Private Limited companies are not affected by the status of their owner when it comes to their existence.
No Minimum paid-up capital – The private limited company can be started without minimum capital.
Limited Liability – If anything happens to the company, its members are personally affected.
Minimum requirement of members and directors – Only 2 members and 2 directors are required.
General overview of the process:
Setting up a 100% foreign-owned company in India involves several steps and requires compliance with various legal and regulatory requirements.
RUN Name Approval: You must obtain approval from the MCA for your desired company name. You can file an online application for name approval through the MCA portal.
Obtain a Digital Signature Certificate (DSC): The MCA in India does not acknowledge regular signatures. A DSC is a digital signature required to file the incorporation documents online. You can obtain a DSC from a certifying authority in India.
Prepare and file incorporation documents: You must prepare the memorandum of association, articles of association, and other documents required for incorporation. These documents must be filed with the Registrar of Companies (ROC) online through the MCA portal.
Get Certificate of Incorporation: The incorporation certificate and PAN of the company are issued if the MCA deems the incorporation application complete and acceptable. The MCA typically accepts all incorporation petitions in less than five working days.
Other Important Points in Registration: –
- A minimum of one of the company’s directors must be a resident of India, which means they must have spent at least 182 days there in the previous calendar year.
- A maximum of 200 members in a Private Limited Company can be shareholders.
- The directors and shareholders can be the same person.
- DSC (Digital Signature Certificate) for Directors, Shareholders & Witness
Documents Required for Incorporation: –
| Directors document requirement list (Please provide the below documents for all the directors, shareholders & witnesses) | Documents for registered office address proof |
| Email ID and Mobile Number | If any Director or Shareholder owns the Property: Sale deed of the Property&NOC from the owner |
| Passport size photograph (Scan Copy) | |
| PAN Card copy (Mandatory) | |
| Proof of Identity (Any one of the below)Passport Driving LicenseAadhar Card | If the property is taken on rent by any Director or Shareholder: Rent Agreement &NOC from the owner |
| Proof of Residence (In the name of Applicant) (Any one of the below)Bank StatementElectricity Bill | In addition to Property Ownership Documents, the following address proof is required: (Any one of the below) Electricity BillTelephone Bill |
| Important Points | |
| Self-attestation is mandatory on all the scan Documents. | If you show your registered office address on your Rented property, Rent Agreement must be. be in one of the director’s/Partner’s names |
| The address proof should be in the applicant’s name and have a Pin/Zip code. | Rent Agreement in the name of proposed/yet. to be a registered company is not allowed |
| The address proof shall be 30 days at maximum. | |
In the case of a Foreign Director – A passport copy shall be required in place of PAN. In addition, all documents and the application form need to be notarised or apostilled by Indian Embassy in the resident country to get a digital signature.
The following documents shall be required for foreign individuals or corporate as a shareholder in the proposed Company.
- Board resolution of the Foreign Entity authorising investment in shares of the Indian Company.
- Copy of the charter and certificate of incorporation of the foreign entity Copy of the charter and certificate of incorporation of the foreign entity.
- Copy of address proof for the foreign company. Example Bank Statement for the latest 2-3 months.
Timeline of Registration: –
| Activity | Time Required |
| Documentation | It depends upon the time taken by the Promoters. |
| DSC (Digital Signature Certificate) | It depends upon the time the Promoters took—generally, 2 days for residents and 7 days for foreigners. |
| Preparation of Main Object & Name Availability Search | 5 days |
| Filing of Incorporation Documents | 7 days |
What you get finally?
- DIN for 2 Directors
- Digital Signature Token for 2 Persons with 2 years validity
- MOA + AOA
- Incorporation Certificate
- Company PAN Card
- Company TAN/TDS Number
- PF + ESIC + Professional Tax Registration
- Customized Incorporation Master File
What is next?
Getting Commencement Certificate
Commencement of Business Certificate is the declaration that the Director of the Company needs to file with the Registrar of Companies. Moreover, this declaration is filed in Form INC-20A within 180 days of the incorporation of the Company.
What’s Required: Open a Bank account and transfer share application money as per the Memorandum of Association and get Bank Statement. Please note, in the case of foreign shareholders, discuss with Bank the foreign amount to be transferred, as the converted amount should be exact.
FEMA Compliance, applicable in case of foreign Shareholder(s)
The FCGPR reporting is mandatory for all Indian companies that receive foreign investment in equity shares and convertible debentures. The reporting is done through a Single Master Form (SMF), an online form that captures all foreign investments the company receives. Non-compliance with FCGPR reporting requirements can result in penalties and restrictions on further foreign investment. It is, therefore, important for Indian companies to ensure timely and accurate reporting of all foreign investments received.
What’s required: – Major documents include KYC issued by Indian Bank, Foreign inward remittance certificate (FIRC), CS Certificate, CA Certificate for valuation and other internal documents.
Appointment of Auditors – As per the Companies Act 2013, the first auditor of a company must be appointed within 30 days of the date of incorporation.
What’s required: – Consent letter of the Auditor and other internal documents.
Other Business Essential Registrations: –
| Registration Name | What is it? |
| Shop Act Registration | The Shop and Establishment Act, also known as Shop Act, is a state-level legislation regulating commercial establishments, such as shops, hotels, restaurants, and other establishments. The Shop Act aims to provide better working conditions and welfare measures to employees working in such establishments. |
| IEC Registration | IEC stands for Import Export Code, a 10-digit code issued by the Directorate General of Foreign Trade (DGFT) to businesses in India that import or export goods and services. The IEC is a mandatory requirement for businesses that engage in import or export activities, irrespective of the value of the transactions. The IEC is a unique identification code used by customs authorities to track imports and exports and by banks to process international transactions. Government departments also use it to monitor and regulate import and export activities. |
| GST Registration | GST registration is mandatory for all businesses supplying goods or services in India. GST stands for Goods and Services Tax, a tax levied on India’s supply of goods and services. GST registration must be obtained by businesses whose annual turnover exceeds the threshold limit set by the government. |
| LUT Application | LUT stands for Letter of Undertaking. It is a document that exporters in India can use to exempt the payment of integrated goods and services tax (IGST) on their exports. The LUT is valid for one year and must be renewed before expiration. |
| Annual return on Foreign Assets & Liabilities (FLA) | All Indian companies that have received FDI and made FDI in any foreign company during the financial year must file the FLA Return by July 15th of each year. The return needs to be filed online through the RBI’s online portal. |
| SFT Compliance | Income Tax SFT compliance refers to complying with the requirements of the Income Tax Act, which mandates the reporting of specified financial transactions (SFTs) to the Income Tax Department. SFTs include high-value cash deposits, credit card payments, mutual fund investments, purchase or sale of property, and more. |
| Employee Provident Fund | EPF stands for Employees’ Provident Fund, a social security scheme available to all salaried employees in India. The Employees’ Provident Fund Organisation (EPFO) administers the scheme under the Ministry of Labour and Employment, Government of India. EPF registration is mandatory for all establishments with 20 or more employees and optional for establishments with fewer than 20 employees. |
| Employee State Insurance | ESI stands for Employees’ State Insurance, a self-financing social security and health insurance scheme for workers in India. The Employees’ State Insurance Corporation (ESIC) administers the scheme under the Ministry of Labour and Employment, Government of India. The scheme applies to establishments with 10 or more employees, with certain exceptions based on the industry or business type. |
| Labour Welfare | Labour welfare refers to the measures taken by the government and employers to improve workers’ working conditions and living standards. |
| Udyam/MSME Registration | Udyam is a government of India initiative that aims to promote and support entrepreneurship and the growth of small and medium enterprises (SMEs) in the country. MSMEs registered under Udyam can avail of various benefits and schemes provided by the government, such as subsidies, loans, and other incentives. The registration is valid for a lifetime and does not require any renewal. |
| Profession Tax Enrolment Registration | The State Government levied a professional tax on individuals and entities engaged in various professions and trades, such as doctors, lawyers, chartered accountants, and business entities such as companies, partnership firms, and sole proprietorships. The professional tax rate varies from state to state and is generally based on the income or turnover of the individual or entity. |
| Profession Tax Registration Certificate | The employer generally deducts the tax from the employee’s salary and remits it to the State Government. The professional tax rate varies from state to state and is usually based on the income or salary of the employee. The tax is deducted at source and is reflected as a deduction in the employee’s salary slip. The employer is responsible for deducting and remitting the tax to the State Government on behalf of the employee. |
| Any other registration as per the industry | Business needs to go for relevant registration based on their working industry. Such as the Food business must get FSSAI etc. |