Register a startup company in India, Business growth in India has seen a recent spurt and more and more people choose to set up their own business instead of doing jobs. Several campaigns run by the Government of India such as the Make in India initiative, Startup India campaign, and Standup India have greatly helped in promoting this development.
However, the intention of starting a business is just the beginning. Business starters should also know how to achieve a well-known startup status. In this post, we will help you understand the process of register a startup company in India.
These Methods can be Clearly Divided into Two Parts:
- Establishment of Business
- Applying for startup status under Startup India campaign.
First Phase: Establishing Business in India
The first step is to set up a business. There are five types of formats you can use to set up your startup business in India. They are:
- Registered Partnership Firm
- Limited Liability Partnership (LLP) Firm
- One Person Company (OPC)
- private Limited company
Here’s what you should follow for each category
1. Registered Partnership Firm:
To become a registered partnership firm, what you need to do is:
- Select the name of the firm.
- Prepare a partnership agreement. This will include details such as name and address of the firm and partners, entity of business, capital contribution and profit-sharing ratio.
- Register your firm with the Registrar of Firms in your state. To register you will need the following:
A. Application for registration.
B. A certified copy of the partnership name.
C. Proof of ownership of the place of business or business agreement.
Once the firm is registered, the partners are required to apply for a PAN card and open a current account.
2. Limited Liability Partnership (LLP) Firm:
- Apply for Designated Partner Identification Number (DPIN) and Digital Signature Certificate (DSC).
- Prepare a partnership agreement and agree on details such as name and address of the firm and partners, entity of business, capital contribution and profit-sharing ratio.
- Apply to the Ministry of Corporate Affairs (MCA) with 2-3 name options for the name of the firm.
- Fill in the Incorporation Document, Subscriber Request, and Named Partner details such as their name, address and consent documents.
- After incorporation, file LLP agreement with MCA within 30 days.
- After this, apply for PAN and TAN for LLP.
3. One Person Company (OPC):
An OPC is a kind of private company that is considered an organization under the Startup India program. MCA has provided a simple process called SPICe format to register an OPC. Here’s how it works:
- Apply for Digital Signature Certificate (DSC).
- Apply for the company name in INC-1.
- Prepare Memorandum and Articles of Association (MOA and AO A). Enter INC Form 32 with MOA and AOA.
- Allocation of approved company names under INC-1 application
- DIN allocation
- New company investment
- Company Pan
- Company Tan
Enter the affidavit from the shareholder and also the consent and identity of the witness and proof of address. Once PAN and TAN are included, then you can open a current account.
4. private Limited company:
Here’s how you can register for a private company if the number of shareholders is more than seven (if it is seven or less, you can use the SPICe format described above under OPC formation):
Initially, apply for your Director Identification Number (DIN) and your Digital Signature Certificate (DSC). Go to the MCA site to see name availability and apply with 2-3 options in order. Then, file Form INC-2 with the Memorandum and Articles of Association within 60 days with your state Registrar of Companies (ROC).
After registration, apply for your company’s PAN and TAN. If the sales in the business are expected to be more than Rs 20 lakh, then apply for GSTIN as well.
Phase two: Achieving Start-up level in India
The Government of India Startup India Action Plan helps startup companies in India in three ways:
- Simplifying the entire business process through various initiatives.
- To provide funding support and incentives.
- Increase the relationship between industry and academia and the growth of firms on campuses.
The definition of a start-up business in India for this purpose is any private limited company, registered partnership, or limited liability partnership, which is not more than seven years old (ten years for biotech enterprises). And whose turnover does not exceed 25 crores? Various campaigns have been launched to assist startups. Some of these are as follows:
- Self certification for various labor and factory laws
- No tax on profit for 3 years.
- No tax on capital gains for the year.
- Establishment of the fund with a total corpus of Rs 10,000 crore.
- The Startup Hub has been established as a hub for speedy completion of works and to help in increased exchange of knowledge and funding.
- Legal assistance for fast filing of patent filing and patent examination process.
- The buying process has been made easier by removing prior experience or business requirements.
- A fast winding process.
Application to Start Register a Startup Company in India:
One can fill an application to register a startup in India, by visiting the Startup India portal and filling the application form and uploading the required documents, which is called the identity certificate for the startup.
There are five blocks to fill for startup companies in India, such as:
1. Description of company or organization: Here you have to enter your company type (company, LLP, partnership), industry, region, category, incorporation or registration number and date, company, name, and PAN details.
2. Authorized Representative Details: This will include the name, designation, and contact details of the authorized person.
3. Director (S) / Partner (S) Description: These include their name, gender, address, and contact details.
4. Additional Information: You need to provide some additional details such as a number of employees, level of development of the product/system, details of IPR applications, etc.
5. Tax Benefits: These are available to businesses formed/formed between 1 April 2016 and 31 March 2019.
6. Self-certification: Here you need to upload your company incorporation certificate, which has been issued to you by MCA. This file can be less than 5 MB in JPG, PNG, or PDF format.
7. Additional documents/details: You can provide additional documents/details such as website links, videos, pitch decks, etc. to support your application.
Once the application is complete, it will be scrutinized and then India registration certificate will be provided to the company/organization.
Under the Startup India Action Plan, the government has also launched initiatives like the Standup India Scheme to help weaker sections of the society and women businesses take bank loans between Rs 10 lakh and Rs 1 crore.
Initiatives like Pradhan Mantri Mudra Yojana (PMMY) have been introduced to help small/micro enterprises to obtain funds from making and selling their products. Such incentives have helped businessmen think to establish the best business in India.
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