Log In Sign Up

Register your company in the fastest & easiest way

Plans starting from Rs. 5,500/-

  • All kinds of registrations & incorporations done
  • Dedicated CA allotted throughout the process
  • Completely online process with Email/Skype/Phone support

Get Expert Assistance

Company Registration – How to Register a Company in India

How to Register a Company in India? Registering your company under the right business structure is an important decision. Find out the prose and cons of different structures.

Updated on

Registering your business under the right structure of company registration in India is as important as any other business-related activity, from engineering to design to marketing to sales to support. The right business structure and company registration in India allow you to operate with efficiency and meet the business targets and objectives that have been set by different departments of the business. 

register a company

Company registration in India is also a legal compliance that needs to be done by businesses. Once you have the basics correct, you also need to understand the process for how to register a company in India. Let’s take a look at these in detail below.

What are the types of business structures in India?

Before you can get to the process of how to register a company in India, you need to know the basics of company registration in India. There are many types of business structures that you can choose from. Here are some of them:

  1. Sole Proprietor – You will be the sole owner of a business. But you can always employ people. You will be responsible for all business decisions.
  2. Hindu Undivided Family (HUF) – The members of a family can start an HUF. The HUF is considered as a separate legal entity.
  3. Partnership Firm – A group of people carry on business together and share profits and losses in a partnership firm. The partners can employee staff but the partners are considered as business owners and not employees.
  4. Private Limited Company (PLC) – A company is a separate legal entity from you. It has shareholders(owners) and directors(who run the business). You will be an employee of the 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

Why is it important to choose the right business structure?

The form of business structure you choose while applying for company registration in India determines the type of Income Tax Return you file. Also, every type of business structure has a different level of compliances required.

For example, a sole proprietor has to file only an income tax return. But a company has to file income tax return, companies annual return and also get a compulsory statutory audit done.

Abiding by so many legal compliances requires spending money on auditor, accountant and a tax filing expert.

Hence, the task of selecting the right kind of business structure when filing for company registration in India will help you to be legally compliant as you will know what is coming your way in terms of legal compliances.

Also, some business structures are more investor-friendly than others. Investors will always have more trust in a group of people who have a recognised and a legal business structure.

For example, an investor may hesitate to give money to a sole proprietor. On the other hand, if a good business idea is backed by a recognised legal structure (like LLP, Company, etc) the investors will be more comfortable in making an investment.

How to choose a business structure while applying for company registration in India?

  1. How many owners will your business have?
You need to ask yourself these important questions so that you know how to register a company in India. For instance, if you want to own the entire business and you have entire initial investment required for the business, it is best to go for Sole Proprietor or One Person Company.

On the other hand, if you want your business to have 2 or more owners and also want people to bring in investment it is best to go for HUF, Partnership Firm, Limited Liability Partnership (LLP) or Private Limited Company

  1. What is the money you are ready to spend for setting up your business?

If you want to spend less initially, it would be wise to go in for Sole Proprietor, HUF or Partnership Firm.

But if you are sure that you will be able to recover setup and compliance costs you can go in for One Person Company, LLP or a Private Limited Company

  1. Willingness to bear the entire liability of the business.

Business structures like sole proprietor, HUF, and partnership firm have unlimited liability. This means that in case of any default in loans the entire money will be recovered from you and the members or partners in the ratio of profit sharing.There is a high risk to personal assets in this case.

Companies and LLPs have a limited liability. This means that your liability is restricted only to the amount of contribution made or the value of shares.

  1. Income Tax Rates Applicable to business.

The income tax rate applicable to a sole proprietorship and HUF is the normal slab rates. Also in case of sole proprietorship, the business income is clubbed with the individual’s other income.

But in case of other forms of entities like partnership and company tax rate of 30% is applicable.

Also, any business structure other than sole proprietor has to file a separate tax return.

  1. Plans of getting money from investors.

As mentioned earlier it is difficult to get investment when your business structure is not registered. Entities like LLP and  Private Limited Company are more trusted when it comes to investment. 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 answer your queries regarding how to register a company in India and help you with all the necessary documentation needed for company registration in India.

How to Register a Company in India?

Now that we know how to choose the right business structure, the next question that arises is how to register a company in India? It is a simple 4-step process which we have detailed below:
  1. Acquiring Digital Signature Certificate(DSC)
  2. Acquiring Director Identification Number (DIN)
  3. Filing an eForm or New user registration
  4. Incorporate the company
These are the basics of how to register a company in India. Now, it is obvious that you will need help in obtaining this documentation and start your application process. Worry not, because our tax experts can help you with all of this in no time at all. So, the next time someone you wonder how to register a company in India, you can easily log in to our website and use our services.

All Articles

  1. A share Certificate is issued by a company evidencing that a person named in such certificate is the owner of the shares of Company
  2. Gumasta License is a mandatory registration required for doing any kind of business in the state of Maharashtra. This is a certificate which provides you authority to do your business at a particular place and to be recognized by Government or Bank. Read more about Gumasta License here.
  3. Difference between authorised and paid up share capital is mentioned in detail with an example to understand. Now there is no minimum paid up capital requirement for the Companies.
  4. The Udyog Aadhar Registration is a great boost for SMEs in the country and this article details the registration process for the same.
  5. PAN Card for Companies can be applied by either by the online mode or the offline mode. Get your own business or company PAN Card in India.
  6. In this article, you will learn what documents are required for registering an MSME in India.
  7. In this article, you will learn about all the documents required for registering a society.
  8. In this article, we will talk about all the documents required for registering a partnership firm in India.
  9. In this article, we will talk about the documents required for LLP registration in India.
  10. Let us see the essentials required to start and manage a business.
  11. In this article, we will talk all about the Director Identification Number or DIN, How to apply for DIN Online, Forms available for DIN, Form DIR-3 is to be filled only for Directors appointing in existing companies.
  12. In this article, we discuss the need for the online sellers to do a company registration.
  13. In this article, we discuss the process of registering a software company in India.
  14. The article gives you the list of Class Codes of all Trademark goods and services.
  15. In this article, we enlist all the important documents required for Sole Proprietorship Registration in India. Also, proprietor can use their PAN for opening bank accounts as also Income Tax filing, and for obtaining license/registrations in the name of the firm.
  16. In this article, we discuss the producer company in India under Companies Act, 2013 and all about its procedure & documentation for incorporation.
  17. In this article, you will learn how to register online as Non Government Organisation / NGO in the form of Section 8 Company, under Companies Act, 2013.
  18. A partnership firm is where two or more persons who can come together and share the profits in agreed ratio, Steps to register in India, documents required for registration, why it is important to register
  19. This article talks about the importance of the ROC / Registrar of Companies in India. It's under MCA which deals with the administration of companies & LLPs
  20. The MCA is a government portal containing details of all the companies and LLP incorporated in India. Here is how you can check company registration status.
  21. Nidhi Company is a type of Non-Banking Financial Company (NBFC). It is formed to borrow and lend money among its members.
  22. A Society Registration is an association of several individuals combined using a mutual accord to deliberate, govern & act cooperatively for some communal purpose.
  23. Sole Proprietorship is a business managed by a single person and has less compliance requirement. Learn about Sole Proprietorship procedure & documents required.
  24. MSME stands for Micro, Small and Medium Enterprises. The MSMEs enjoy benefits in terms of taxation, compliance requirements, credit terms etc.
  25. OPC - One Person Company is a private company incorporated by one person. Learn about the steps & FAQs for OPC Registration in India.
  26. A structured registration methodology guide for Trademark Registration in India. File & register your trademark to protect your business or product name.
  27. Limited Liability Partnership / LLP incorporates the benefits of both a partnership firm and a company into a single form of organization., Documents required for incorporation, steps for incorporation of LLP in India
  28. Choose the right business structure for registering your company. Compare between Private Limited Company, Limited Liability Partnership & One Person Company.
  29. 7 easy steps to register your startup in Startup India initiative. Simple, time-saving!
  30. If you are planning to start a business read more to find out
  31. Entrepreneurs need to be very careful throughout their entire Startup journey right from its inception. Know the top 3 registrations mistakes that Startups should avoid.
  32. In India a business can be registered primarily under 5 structures. You can start as a private limited company, one person company, limited liability company, general partnership or proprietorship firm.