Starting a business requires much more than a unique idea and marketing strategy. You need to register the business legally to start operations. Company registration is an essential part of setting up a business. It can be daunting to get all approvals for running a business. However, the benefits of creating a separate legal entity are immense. Choosing the right business structure is essential in the company registration process. A reliable company registration India consultant can help you register the business by providing the right guidance on each step. Read on to learn more about the importance of company registration in India.
Understanding the company registration process in India
Starting a brand-new business is always exciting. Company registration is the first step towards starting your own business. Business owners must register a business before commencing operations legally. Let’s take a quick look into some crucial steps in the company registration process.
- Obtain the digital signature certificate
The first step in the company registration process starts with obtaining the Digital Signature Certificate (DSC). The digital signature certificate is the digital version of physical signatures needed for the verification and authentication of documents. All directors of the company must file for the DSC. It is issued by government-recognized authorities.
- Apply for the DIN
The Director Identification Number (DIN) is a unique number given to the directors of a company. You have to apply for the DIN, as it is required in the company registration form. It can be obtained by filing the SPICe+ form.
- Registration on the MCA portal
The third important step in the company registration process requires registering the business on the Ministry of Corporate Affairs (MCA) portal by submitting the SPICE+ form and documents. Companies need to reserve their legal names as well.
- Obtaining the certificate of incorporation
The final step in the registration process requires obtaining the certificate of incorporation after submitting the application and documents to the registrar of the companies.
Benefits of registering a company
Company registration is a mandatory step to start a business. However, there are many benefits of incorporating a business. Here are some prominent ones that you must be aware of.
- Separate legal entity
Registering a company will give your business a separate legal entity. The company will be treated as an artificial person and have many rights, including the right to own an asset, the right to sue and be sued, etc.
- Limited liability protection
Many business structures, such as Limited Liability Partnerships, Private Limited Companies, etc., offer limited liability protection to the owners. It means that the business owners will not be personally liable for the company’s liabilities.
- Business loan and bank account
Registering a business will make you eligible for various business loans and government schemes. In addition, it will help you obtain a business bank account for managing business finances.
- Transferability of ownership
Registering a company makes it easier to transfer ownership of a business. For example, shareholders can transfer the ownership of the shares to new people.
