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Guide to

Private Limited
Company

www.IndiaFilings.com
Content
Welcome 3

Reasons to Choose 4

Private Limited Company 7

Unique Features 8

Incorporation Process 9

Documents Required 10

Taxation 11

Other Essentials 12

FAQs 13

Pricing 15

Whats Included 16

IndiaFilings Services 17

Support 18
Welcome
to IndiaFilings.com

IndiaFilings.com is committed to helping entrepreneurs and small business owners start,


manage and grow their business with peace of mind at an affordable price. We are a TUV ISO
9001:2008 Certified Company and perform all our services with quality and efficiency.

Dear Client, Our Guide on Private Limited Company is designed


to help the Entrepreneur understand the Private
Thank you for your interest in IndiaFilings.com! - The Limited Company type of business structure and the
Leader in New Business Incorporation. process for incorporating the same.

We are happy to note that you are in the process of In case you have any questions, after reading through
incorporating a new Private Limited Company for our guide, feel free to call one of our Business Advisors
your business and we look forward to helping you and we will be happy to help you with starting your
with the same. business.

IndiaFilings.com is committed to helping We wish you all success with your new venture!
entrepreneurs and small business owners start,
manage and grow their business with peace of Best regards,
mind at an affordable price. Our aim is to educate
the entrepreneur on the legal and regulatory
requirements and be a partner throughout the entire
business lifecycle, offering support to the company
at every stage to make sure they are compliant and Lionel Charles
continually growing. Managing Director & CEO

IndiaFilings.com 3
Reasons to Choose
IndiaFilings.com

TUV ISO Certified CRISIL Verified


IndiaFilings is ISO 9001:2008 Certified by TUV IndiaFilings is a CRISIL Verified Business.
SUD, a leading Certification Body recognized CRISIL is a subsidiary of Standards & Poor, a
worldwide. leading International Rating Agency.

No Hidden Fee Backed by Experience


We have a fair and transparent pricing IndiaFilings is an initiative of VERVE Financial
structure. We do not have hidden fees Services Pvt Limited, having an experience of
associated with any of our services. over 30 years in Financial Advisory.

4 IndiaFilings.com
Reasons to Choose
IndiaFilings.com

Client Confidentiality One Stop Solution


We take Client confidentiality seriously. IndiaFilings.com provides all the services
We never disclose client information or use required for launching a successful startup.
our Clients brand name for our marketing. We provide legal and financial services.

Dedicated Client Portal E-Mail & SMS Alerts


IndiaFilings.com provides its Client with access IndiaFilings.com provides its Client with
to a dedicated Client Portal wherein the regular email and SMS updates as the
engagement can be managed and tracked. incorporation engagement progresses.

IndiaFilings.com 5
About
Private Limited Company
An Overview

Private Limited Company


Private Limited Company is one of the most widely used form of business structure in India. Private Limited
Company offer a host of benefits to the promoters like Limited Liability Protection, Continuous Existence, Easy
Transferability, Automatic FDI in some sectors , etc., making it one of the most ideal business constitution.

Private Limited Company is a type of business entity up operations, equity or debt funding and having
where the minimum numbers of members are two foreign Directors or shareholders. 100% Automatic
and the maximum number is two hundred. A private Foreign Direct Investment is allowed in Private
limited company offers limited liability protection for Limited Company in many of the sectors.Private
its members along with a host of other advantages Limited Company requires a minimum of two people
like continuous existence, easy transferability, to incorporate and can be incorpoated within 20
separate legal entity, etc.,. Private Limited Company working days, subject to documents availability and
is also ideal for any business with plans for scaling Government processing time.

IndiaFilings.com 7
Unique Features
Of a Private Limited Company

Separate Legal Entity Uninterrupted Existence


Separate Legal Entity
Uninterrupted Existance
A company is a legal entity and a juristic person A company has perpetual succession, that is continued
Aestablished
company isunder
a legalthe Act. and
entity Therefore a company
a juristic form
person estab- or uninterrupted existence until it is legally dissolved. A
A company has perpetual succession, that is continued
lished
of organization
under the Act.
hasTherefore
wide legal
a company
capacity andformcan
of organ-
own company, being a separate legal person, is unaffected by
or uninterrupted existence until it is legally dissolved. A
property
ization has wide and alsoand
legal capacity incur
candebts.
own property and the death or other departure of any member.
company, being a separate legal person, is unaffected by
also incur debts. The members (Shareholders/Directors) of
the death or other departure of any member but con-
a company have no liability to the creditors of a company
tinues to be in existence irrespective of the changes in
for such debts.
membership.

Borrowing Capacity Easy Transferability

A company enjoys better avenues for borrowing of funds. Shares of a company limited by shares are transferable
It can issue equity, debentures and obtain secured as well by a shareholder to any other person. Filing and signing
as unsecured loans .Banking and financial institutions a share transfer form and handing over the buyer of the
prefer to render large financial assistance to a company shares along with share certificate can easily transfer own-
rather than partnership firms or proprietary concerns. Easy Transferability
ership of the company.
Borrowing Capacity
Shares of a company limited by shares are transferable
A company enjoys better avenues for borrowing of funds.
by a shareholder to any other person. Filing and signing
It can issue debentures, secured as well as unsecured
a share transfer form and handing over the buyer of the
and can also accept deposits from the public, etc. Even
shares along with share certificate can easily transfer
banking and financial institutions
Owning prefer to render large
Property Limited Liability
shares.
financial assistance to a company rather than partnership
A company being firmsa or proprietary
juristic person,concerns.
can acquire, own, enjoy Limited Liability means the status of being legally
and alienate, property in its own name. No shareholder responsible only to a limited amount for debts of a
can make any claim upon the property of the company so company. Unlike proprietorships and partnerships, in a
long as the company is a going concern. limited liability company the liability of the members in
limited.
Owning Property Limited Liability

A company being a juristic person, can acquire, own, enjoy Limited Liability means the status of being legally respon-
and alienate, property in its own name. No shareholder sible only to a limited amount for debts of a company.
can make any claim upon the property of the company so Unlike proprietorships and partnerships, in a limited
long as the company
Capacity to sueisand
a going concern.
be sued liability company theDual Relationship
liability of the members in respect of
the companys debts is limited.
To sue means to institute legal proceedings against or to In the company form of organization it is possible for a
bring a suit in a court of law. Just as one person can bring company to make a valid and effective contract with any
a legal action in his/her own name against another in that of its members. Thus, a person can at the same time be a
persons name, a company being an independent legal shareholder, creditor, director and also an employee of the
entity canCapacity
sue and to sue
also beand
suedbeinsued
its own name. Dualcompany.
Relationship

To sue means to institute legal proceedings against or to In the company form of organization it is possible for a
bring a suit in a court of law. Just as one person can bring company to make a valid and effective contract with any
a legal action in his/her own name against another in that of tis members. Thus, a person can at the same time be a
persons name, a company being an independent legal shareholder, creditor, director and also an employee of the
entity can sue and also be sued in its own name. company.

8 IndiaFilings.com
Incorporation Process
Overview

Obtaining Obtaining
DSC DIN

Obtaining Filings
Name for
Approval incorporation

1 Obtaining DSC 2 Obtaining DIN


Digital Signature Certificate must be obtained for Directors who Director Identification Number (DIN) must be obtained for all the
require Director Identification Number. Digital Signature can be proposed Directors of the Private Limited Company. DIN can be
obtained within 2 days of receiving signed Digital Signature ap- obtained within 2 working days of receiving Digital Signature and
plication. Notarized Form DIR-4.

3 Name Approval 4 Filing for Incorporation


Once, DIN is available for two of the proposed Directors in the Com- Once, the name approval application is approved by the MCA, we
pany, application for name approval can be made with Ministry of can file the application for Incorporation. Application for incorpo-
Corporate Affairs (MCA). Usually, name approval applications are ration is approved by the MCA within 5 working days. Note: MCA
approved or declined by the MCA within 5 working days. processing times vary depending on the workload of MCA.

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Documents Required
For Company Registration

Documents required for obtaining DSC, DIN & Name Approval


Director Passport Size Photos

Director PAN Card (Self-Attested Copy)

Director Address Proof (Self-Attested Copy)

Signed Digital Signature Application

Documents required after Name Approval


[Will be drafted by IndiaFilings]
Notarized Form DIR-2

Notarized Form INC-9

Notarized Form INC-10

Notarized Non-Deposit taking Undertaking

Consent Letter of the Directors

Signed Memorandum of Association

Signed Articles of Association

MOA & AOA Witness Identity & Address Proof

NOC from Landlord for Registered Office

Sale Deed or Rental Agreement of Registered Office

Utility Bill bearing the Registered Office Address & Landlord name

Landlord Identity & Address Proof

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Taxation
An Overview

Income Tax
Income tax is levied at the rate of 30% on the
taxable profit of a Private Limited Company.
All Private Limited Companies that record a
profit are liable to pay income tax. Income
tax returns must be filed for a Private Limited
Company before 30th of September of each
financial year.
All businesses, irrespective
of constitution are required
Service Tax
Service Tax Registration is necessary for to pay Income Tax, Service
any business that provides services. Service
tax is mandatory if the annual turnover
of the business exceeds Rs.9 lakhs. Small Tax and VAT. IndiaFilings
Businesses with less than Rs.10 lakhs of
taxable service are exempt from service tax.
Service tax returns are due half yearly on the can help you manage and
25th of April and 25th of October.

maintain all the regulatory


Value Added Tax and legal compliances
VAT or Value Added Tax is a tax levied on all
goods and products sold by a busienss. VAT pertaining to your business.
is typically paid by the customer and the
business is responsible for collecting the tax
and remitting it with the Government. VAT
is levied by the State Government. So each
State has different rules and regulations for
VAT based on the product.

IndiaFilings.com 11
Other Essentials
For your Company

Annual Filing
Private Limited Companys are required to file
their audited financial statements along with
other information in the requisite format
each year with the Ministry of Corporate
Affairs, within 30 days of completion of
Annual General Meeting.
IndiaFilings can help you
Import-Export Code
obtain many of the licenses
Import Export Code (IE Code) is necessary
for any entity importing or exporting
goods or products from or to India. Import- and registrations required
Export Code is a one-time registration
that requires no further renewal or annual
filing. It is recommended for Private Limited for running your business in
Companies to have a IE Code.

India. Talk to our Business


ESI Registration
Employees State Insurance (ESI) is a social Experts if you require any
security and health insurance scheme for
Indian workers. ESI Registration is mandatory
for employers having 10 or more employee. license or registration.
For all employees earning Rs.15,000 or less
per month as wages, the employer must
contribute 4.75% and employee must
contribute 1.75% towards ESI.

12 IndiaFilings.com
Private Limited Company
Frequently Asked Questions

1. How many people are required to incorporate a private limited company?

To incorporate a private limited company, a minimum of two people are required. A private limited company
must have a minimum of two Directors and can have upto a maximum of fifteen Directors. A minimum of two
shareholders and a maximum of upto 200 shareholders are allowed in a private limited company.

2. What are the requirements to be a Director?

The Director needs to be over 18 years of age and must be a natural person. There are no limitations in terms of
citizenship or residency. Therefore, even foreign nationals can be Directors in a Indian Private Limited Company.

3. What is the capital required to start a private limited company?

You can start a Private Limited Company with any amount of capital. However, fee must be paid to the Government
for issuing a minimum of shares worth Rs.1 lakh [Authorized Capital Fee] during the incorporation of the Company.
There is no requirement to show proof of capital invested during the incorporation process.

4. Is an office required for starting a Private Limited Company?

An address in India where the registered office of the Company will be situated is required. The premises can be a
commercial / industrial / residential where communication from the MCA will be received.

5. Do I have to be present in person to incorporate a Private Limited Company?

No, you will not have to be present at our office or appear at any office for the incorporation of a Private Limited
Company. All the documents can be scanned and sent through email to our office. Some documents will also have
to be couriered to our office.

6. What are the documents required for incorporation?

Identity proof and address proof is mandatory for all the proposed Directors of the Company. PAN Card is mandatory
for Indian Nationals. In addition, the landlord of the registered office premises must provide a NOC for having the
registered office in his/her premises and must submit his/her identity proof and address proof.

IndiaFilings.com 13
Private Limited Company
Frequently Asked Questions

7. How long will it take to incorporate a Company?

IndiaFilings.com can incorporate a Private Limited Company for in 14-20 days working days. The time taken for
incorporation will depend on submission of relevant documents by the client and speed of Government Approv-
als. To ensure speedy incorporation, please choose a unique name for your Company.

8. What do I need to quickly incorporate my Company?

To incorporate a Company quickly, make sure the proposed name of the Company is very unique. Names that are
similar to an existing private limited company / limited liability partnership / trademark can be rejected.

9. How long is the incorporation of the Company valid for?

Once a Company is incorporated, it will be active and in-existence as long as the annual compliances are met with
regularly. In case, annual compliances are not complied with, the Company will become a Dormant Company and
maybe struck off from the register after a period of time.

10. What is Director Identification Number (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.

11. 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 doc-
uments using their Digital Signature. Hence, a Digital Signature is required for all Directors of a proposed Company.

12. What is authorized capital fee?

Authorized capital of a Company is the amount of shares a company can issue to it shareholders. Companies have
to pay the Government an authorized capital fee to issue shares in a Company. Companies have to pay authorized
capital fee for a minimum of Rs.1 lakh.

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Pricing
Whats Included
In Company Incorporation

Basic Package - Rs.16,000 (inclusive of taxes)

Startup Consultation 2 Digital Signature USB 2 Director Identification


Tokens - 2 Year Validity Number - Lifetime Validity

Government Fee for Name Stamp Duty for Government Fee for 1 Lakh
Approval & Incorporation Incorporation Authorized Capial

Drafting of all documents Filing of all documents per- Followup with ROC until
pertaining to Incorporation taining to incorporation Incorporation

Company Incorporation Kit PAN Card for Company TAN Registration

Standard Package (Extras) - Rs.20,000 (inclusive of taxes)

Incorporation Documents Customized Share


QuickBooks 1 Year
Folder Certificates

Doorstep Documents Pickpup

Premium Package (Extras) - Rs.26,000 (inclusive of taxes)

Trademark Registration

16 IndiaFilings.com
Included with All
Our Incorporations

Three-Tier
Our Free Expert Verification of
Expertise Consultation Documents

Dedicated
Access to SMS/Email
Incorporation
Client Portal Updates on
Manager
Progress

Fair Fair & Transparent Pricing


At IndiaFilings, we adopt a fair and transparent pricing
policy. Therefore, we provide you with an all inclusive

Pricing cost for incorporation and never request for more or


additional fee once the engae

IndiaFilings.com 17
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