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Registering your business under the right structure is as important as any other business-related activity, from engineering to design to marketing to sales to support. The right business structure allows you to operate with efficiency and meet the business targets and objectives that have been set by different departments of the business. Company registration is also a legal compliance that needs to be done by businesses.

You can register your business in any of the structures that are set out by the government, the choice of which will depend upon the nature of business and number of people involved in it. Some aspects to keep in mind while selecting a business structure are control over operations, especially if more than one person is at the helm of the business; personal liability, which defines how much of your personal assets are involved in the business and long-term growth, which is an extension of your vision of where you want to take the business.

register a company

Depending on these factors, you can get your company registered under a business structure that is best suited to you. Here are the popular business structures in India.

Company type Ideal for Tax advantages Legal compliances
Sole Proprietorship Small merchants and traders – Benefit on depreciation – Individual tax returns to be filed

– Audit, if required

General Partnership Small businesses where two or more people are involved – Benefit on depreciation – Business tax returns to be filed

– Audit if applicable

Limited Liability Partnership Service-oriented businesses or businesses that have low investment needs – Benefit on depreciation – Business tax returns to be filed

– ROC returns to be filed

One Person Company Sole owners looking to limit their liability – Tax holiday for first 3 years under Startup India

– Higher benefits on depreciation

– No tax on dividend distribution

– Business returns to be filed

– Limited ROC compliance

Private Limited Company Businesses that have a high turnover – Tax holiday for first 3 years under Startup India

– Higher benefits on depreciation

– Business tax returns to be filed

– ROC returns to be filed

– Mandatory audit

This is a gist of the business structures that a company can register under. Make sure you choose the right structure. Seek the help of an expert so that you register under proper guidance. Check out our services that will help you with company registration.

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