Private Limited Company Registration
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Private Limited Company Registration in India
A Private Limited Company (Pvt Ltd) is one of the most popular and preferred business structures in India. It is a legal entity separate from its owners, which means it can enter into contracts, own property, and be responsible for its debts. Shareholders in a Private Limited Company have limited liability, which means their personal assets are protected from the company’s financial liabilities.
For small and medium-sized enterprises, a Private Limited Company is the ideal business structure as it allows for growth, limited liability, and easy access to capital while maintaining flexibility in management.
Eligibility Criteria for Private Limited Company Registration
The registration process for a Private Limited Company in India requires certain basic documents and criteria to be fulfilled. Here’s what you need:
- Directors and Shareholders: You need a minimum of 2 directors and 2 shareholders. They can be the same individuals.
- Company Name: Choose a unique company name that complies with the guidelines set by the Ministry of Corporate Affairs (MCA).
- Registered Office: You must have a registered office address in India. This can be a commercial or residential address.
Why Choose Private Limited Company Registration in India?
Limited Liability Protection
One of the primary advantages of registering a Private Limited Company is the protection it offers to the shareholders. Your personal assets are protected from the liabilities of the business, as the company itself is a separate legal entity.
Credibility and Trust
A Private Limited Company adds credibility to your business, making it easier to attract investors, partners, and clients. It’s a well-recognized structure in India, which can make your business stand out in a competitive market.
Perpetual Succession
A Private Limited Company enjoys continuity of existence, meaning the business continues to function even in the case of changes in the ownership structure, such as the death or departure of a shareholder.
Access to Funding:
With a Private Limited Company Incorporation, raising capital becomes easier. Investors prefer funding businesses that are registered as Private Limited Companies because of the transparency and formal structure it offers.
FDI Permitted
A Private Limited Company can receive 100% foreign investment in almost all sectors under the Automatic Route, subject to RBI Reporting. So Private Limited company registration is best business structure for FDI permit.
Low Taxation
Registered companies in India are eligible for various tax exemptions and deductions. Additionally, a Private Limited Company enjoys a more favorable tax structure compared to sole proprietorships or partnerships.
Private Limited Company Registration Fees
Basic Package
- Two Digital Signature
- Memorandum of Association
- Articles of Association (AOA)
- COI, e-PAN & TAN
Standard Package
- Basic Package +
- GST Registration
- MSME Registration
- Bank A/c opening Support
Premium Package
- Standard Package +
- First Auditor Appointment
- ADT-1 filing
- INC 20A (commencement Filing)
2. Stamp Duty will be on Actual basis as its vary from state to state and also depend on amount of capital
Checklist & Documents Required for Company Registration
Minimum Requirements
- 2 to 15 Director
- 2 to 200 Shareholder
- One Resident Director
- 2 to 200 Shareholder
Promoter's Document
- Passport Size Colour Photograph
- Self attested Pan Card of All Promoters
- Self attested Aadhar Card
- Identity Proof – Passport or Voter ID Card or Driving License
- Address Proof – Recent Month Bank statement , Electricity Bill or Telephone Bill or Mobile Bill
Registered Address
- Proof of Premises (Any One): Telephone Bill / Electricity Bill/ Water Bill/ Mobile Bill/ Gas Bill
- No Objection Certificate (NOC) From Owner
- Utility bill would not be older then 2 month
Online Company Registration Process
Incorporating a company through Simplified Proforma for Incorporating Company electronically (SPICe -INC-32), with eMoA (INC-33), eAOA (INC-34), is the default option and most companies are required to be incorporated through SPICe only. The following are the steps involved in registering a company in India:
Step 1: RUN Name Approval
To reserve the company name, an application for company name approval is first submitted to the Ministry of Corporate Affairs. 1 or 2 names with business objective might be included in the name approval application. If a name approval is denied, one or two additional names may be presented. All name approval applications are typically approved by the MCA in less than 5 business days.
Step 2: Obtain Digital Signature for Directors
In India, the Ministry of Corporate Affairs does not allow wet signatures. All signatures for filings with the MCA must be completed with a digital signature that is issued by a Certification Authority in India. Hence, digital signatures are mandatorily required for the Directors before incorporation.
To obtain Digital Signature, the Directors will have to submit a copy of their identity proof and complete a video KYC process. If the Director is a foreign national, the passport and other documents submitted must be apostilled by a local embassy.
Step 3: Incorporation Application Filing
Once the digital signatures are obtained, the incorporation application can be filed in SPICe Form to the MCA with all relevant attachments. Along with the incorporation application, the Memorandum of Association (MOA) and Articles of Association (AOA) of the company are filed.
Step 4: Issuance of Incorporation Certificate , PAN and TAN
If the MCA finds the incorporation application to be complete and acceptable, the Incorporation Certificate is granted along with PAN of the company. The MCA normally accepts all incorporation applications in less than 5 working days.
How Long Does It Take to Register a Private Limited Company?
The process generally takes 7-10 business days to complete. However, this timeline can vary based on the completeness of your documents and any additional steps that may be required for your business.
Private Limited Company Compliances
Once a Private Limited company Registration get done, various compliances must be maintained from time to time to avoid penalties and prosecution. The following are some of the compliances a company would be required to complete after company registration:
1. Post Incorporation Compliance:
Once your Private Limited Company registration is complete, there are essential compliances you must follow to ensure smooth operations and avoid any penalties. Here’s a list of key compliance requirements every newly incorporated company must complete within the stipulated time:
1. Auditor Appointment
All companies in India are required to appoint a practicing Chartered Accountant (CA), who is registered with the Institute of Chartered Accountants of India (ICAI), within 30 days of incorporation. This auditor will be responsible for auditing the company’s financial records and ensuring compliance with accounting standards.
2. Commencement of Business
Within 180 days of incorporation, the company must open a bank current account and deposit the subscription amount mentioned in the company’s Memorandum of Association. For example, if the company has a paid-up capital of ₹1 lakh, the shareholders must deposit the full amount into the company’s bank account. A bank statement proving the deposit should then be filed with the Ministry of Corporate Affairs (MCA). This is a crucial step to receive the Certificate of Commencement of Business.
2. Annual Compliance:
1. MCA Annual Filings:
Every Financial year, all companies registered in India must file a copy of their financial statements with the Ministry of Corporate Affairs. If a company is formed between January and March, it can choose to file the first MCA annual return as part of the annual filing for the following financial year. Forms MGT-7 and AOC-4 comprise the MCA yearly return. The Directors and a practicing professional must digitally sign both of these forms.
2. Director DIN KYC:
Each year, all individuals who hold a Director Identification Number (DIN) – which is assigned during the incorporation process – must complete DIN KYC to authenticate the phone and email address on file with the Ministry of Corporate Affairs.
3. Income Tax Return Filing:
Every Financial year, all businesses must file an income tax return using Form ITR-6. Income tax returns must be filed on time for each fiscal year, regardless of incorporation date. A company’s income tax return must be digitally signed using one of the Directors’ digital signatures.
Taxation for Private Limited Companies
The income tax for companies ranges from 15% to 30%, depending on the case. There are two categories of companies as mentioned below.
A. Newly Incorporated Company: A company incorporated on or after 1st October 2019, and that does not claim any other concession, deduction, exemption under the income tax act, the tax rate is as under
| Particulars | Manufacturing Company | Other Company |
| Tax Rate | 15.00% | 22.00% |
| Surcharge | 10% on tax | 10% on tax |
| Cess | 4% on tax & cess | 4% on tax & cess |
| Effective Rate | 17.16% | 25.17% |
B. For other companies: the income tax rate is 25% in case the turnover is less than 400 Crores and 30% in all cases where the turnover is more than 400 Crores. The Surcharge and education cess at applicable rate is charged in addition to the basic income tax rate.
Ready to Start Your Business?
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Frequently asked questions (FAQs)
A Private Limited Company is a type of business entity that limits the liability of its shareholders to the amount unpaid on their shares. This means that shareholders are not personally liable for the company’s debts. Private Limited Companies are suitable for small and medium-sized businesses and offer a high level of flexibility in management.
Registering your business as a Private Limited Company offers various advantages, such as:
- Limited liability protection for shareholders
- Easy access to funding and investment
- Enhanced credibility and trust with customers and suppliers
- Perpetual succession (the company continues even if owners change)
- Flexible tax planning options
To register a Private Limited Company, you need:
- A minimum of 2 directors and 2 shareholders (can be the same individuals)
- A registered office address in India
- Digital Signature Certificate (DSC) for directors
- Director Identification Number (DIN) for all directors
- A clear business name that adheres to the naming guidelines set by the Ministry of Corporate Affairs (MCA)
Typically, the registration process for a Private Limited Company takes around 7-10 business days, depending on the document verification, approval from the Ministry of Corporate Affairs, and other procedural factors.
You will need the following documents:
- Identity proof (Aadhar card, Passport, Voter ID, etc.) of directors and shareholders
- Address proof (Electricity bill, Bank statement, Rent agreement, etc.)
- A passport-size photograph of all directors
- Proof of the registered office address
- No Objection Certificate (NOC) from the landlord if the office is rented
Yes, a foreigner can be a director or shareholder in a Private Limited Company in India. However, there must be at least one Indian resident director. Additionally, the foreign shareholder must adhere to the Foreign Direct Investment (FDI) policies of India.
There is no prescribed minimum capital requirement for registering a Private Limited Company. The company can be registered with a nominal capital (such as ₹1 or ₹10). However, the capital must be adequate to run the business operations effectively.
Yes, all Private Limited Companies are required to file annual returns with the Ministry of Corporate Affairs. This includes:
- Statutory Audit
- Filing of financial statements (Balance Sheet and Profit & Loss Account)
- Annual Return with the MCA
- Income tax returns with the Income Tax Department
After registering a Private Limited Company, the following compliances must be met:
- Comencement of Business (INC20A) Filing
- Holding annual general meetings (AGMs)
- Maintaining statutory registers (like minutes, resolutions, etc.)
- Filing financial statements and returns with the MCA
- Tax filings with the Income Tax Department
- Compliance with Goods and Services Tax (GST) if applicable
Yes, you can change the name or business objectives of your company after registration, subject to approval from the Ministry of Corporate Affairs. This involves passing a special resolution and filing necessary documents with the MCA.
Some of the advantages include:
- Limited liability protection
- A separate legal entity distinct from its owners
- Easier access to business loans and funding
- Ability to transfer ownership easily (through shares)
- Enhanced business credibility
The registration cost varies based on the company’s share capital, state of registration, and additional services you may require. However, on average, the cost includes:
- Government fees for company name approval and registration
- Professional fees for document preparation, DSC, and DIN
- Additional charges for obtaining GST registration or other licenses, if applicable
Starting the registration process with SetupFiling.in is simple:
- Fill out the online registration form
- Upload the required documents
- Pay the registration fee
- Our experts will guide you through the entire process, from name approval to certificate issuance.
Yes, you can apply for GST registration along with the Private Limited Company registration. Our team can help you with the GST registration process simultaneously.
A Director is responsible for managing the day-to-day operations of the company, making key business decisions, and ensuring compliance with legal and financial regulations. Directors are also accountable to shareholders and must act in the best interest of the company.