Advantages of Private Limited Company

Private Limited Company is a business entity incorporated under Companies Act 2013, which has minimum two members and maximum 200 members and it offers limited liability or legal protection for its shareholders. A Pvt Ltd gets following advantages and also many more facilities:

Separate Legal Entity

A company is a legal entity and a juristic person established under the Act. Therefore a company form of organization has wide legal capacity and can own property and also incur debts. The members (Shareholders/Directors) of a company have no liability to the creditors of a company for such debts.

Borrowing Capacity

A company enjoys better avenues for borrowing of funds. It can issue debentures, secured as well as unsecured and can also accept deposits from the public, etc. Even banking and financial institutions prefer to render large financial assistance to a company rather than partnership firms or proprietary concerns

Limited Liability

Limited Liability means the status of being legally responsible only to a limited amount for debts of a company. Unlike proprietorships and partnerships, in a limited liability company the liability of the members in respect of the company's debts is limited.

Owning Property

A company being a juristic person, can acquire, own, enjoy and alienate, property in its own name. No shareholder can make any claim upon the property of the company so long as the company is a going concern.

Easy Transferability

Private Limited Company can be transferred easily without any complications. Change in Directors and Shareholders can be done in less than 2 Hours.

Easy Debt Access

A private limited company has more options for taking on debt than Limited Liability Partnerships and One Person Companies.