guide to start business in india
Post on 04-Apr-2018
216 Views
Preview:
TRANSCRIPT
-
7/29/2019 Guide to Start Business in India
1/28
Guide to Setup A Business
LimitedCompany
LimitedLiabilityPartnership
-
7/29/2019 Guide to Start Business in India
2/28
CompaniesInnBusinessSetupServices ..........................4
OineandOnlineregistraon
BusinessOrganisations:AnIntroduction ..........................6
IncorporatedStructures
Benetsofincorporatedbusinessstructures
CompanyformofBusiness ...............................................8
PrivateLimitedCompany
PublicLimitedCompany
CompanyRegistraon
Conceptoflimitedliability
ManagementandadministraonofaCompany
Compliancerequirementsforacompany
Table of Contents
-
7/29/2019 Guide to Start Business in India
3/28
LLPformofBusiness.........................................................14
LLPRegistraon
ManagementandadministraonofanLLP
CompliancerequirementsforanLLP
WhyLLPisamorearacvestructuretodoBusiness?
OtherregistrationsrequiredforCompany/LLP.....................18
Accounts&Audit.................................................................20
Taxation..............................................................................22
WhychooseCompaniesinn.comtoformyourcompany/LLP?.....24
-
7/29/2019 Guide to Start Business in India
4/28
01
CompaniesInn has dedicated team of professionals with vast experience in the eld of
business incorporaon in India. Our onestop soluon brings together all the external
requirements andservicesrequired in theincorporaonprocessunderoneroof.We can
helpyoutoincorporateyourcompanyorLLPorconvertanexisngbusinessintoLLPfrom
thecomfortofyourhomeoroce.
Ourregistraonprocesshasalreadyhelpedmanycustomersinachievingquickerturnaround
mesinincorporangtheirbusinesswithoutlosingqualityandthattooatanaordableprice. Useofstandardizedprocessesand informaontechnology enablesusto oerthe
incorporaonserviceatafeemuchbelowtheusualmarketrates.Fordetailedinformaon
onourservicecharges(inclusiveofGovernmentFees),pleasevisit www.companiesinn.com.
CompaniesInn Business Setup Services
-
7/29/2019 Guide to Start Business in India
5/28
5
Offline and Online registration
Ifyoupreferfacetofaceinteraconintheregistraonprocess,wehaveocesinmajor
ciesalloverIndiaasdetailedonthebackcoverpage.Elseyoucanavailourservicesthrough
phoneortheinternetfromthecomfortofyourhomeoroce.
Foronlineincorporaon,visitourwebsitewww.companiesinn.com.Fillintheparculars
abouttheCompany/LLPyouwanttoregisterandproceedtoplacetheorder.Thewell
explainedstepswillhelpyoucompleteyourorderinlessthan5minutes.
Foroineregistraon,llthequesonnairegivenalongwiththisbookletanddeliverthe
sameatanyofouroces.
OurdedicatedprofessionalswillcompletealltheformaliestogetyourCompanyorLLP
registeredanywhereinIndia.ApartfromincorporaonwecanalsogetyourLLPagreement
customizedatanaordableaddionalcharge.Wecanalsohelpyoutoobtainyourbusiness
TaxNumbers(PAN&TAN)andotherCentralandStateGovernmentregistraons,tocomplywiththevariouslawsgoverningbusinessestablishmentsinIndia.
ThisGuidedevelopedbyourresearchteamistohelpyoutodecidewhethertheCompany
orLLPstructureistherightformforyourbusiness.Thisguidewillhelpyoutounderstand
thebenetsofCompanyorLLPstructure,themajordierencesbetweenCompanies,LLPs
andotherbusinessstructures,thetaxbenetsandthebasicrequirementsandcompliance
requirementsofacompanyorLLPbeforeandaeritsincorporaon.
Formoredetailsyoucanalwayswritetousatinfo@companiesinn.comorcontactanyofthe
CompaniesInnocesmenonedonthebackcover.
-
7/29/2019 Guide to Start Business in India
6/28
Businessisalegalorganisaondesignedtoprovidegoodsorservicesinexchangeofmoney.In
India,wehaveseveralbusinessorganisaonssuchasCompany,LimitedLiabilityPartnership
(LLP),PartnershipFirmandSoleProprietorship.Basicallytheseorganisaonsareclassied
into incorporatedandunincorporatedstructures.CompanyandLLPare the incorporated
businessorganisaonsandPartnershipFirmandSoleProprietorshiparetheunincorporated
structures.
Till2009, the only limited liability businessorganisaonavailableunderlaw in Indiawas
theLimitedCompany.Inordertogivesmallandmediumenterprisesgreaterexibilityin
incorporangtheirbusinesses,theGovernmentof Indiahasintroducedanewlawforthe
registraonofLimitedLiabilityPartnershipsinIndia.
Business Organisations: An Introduction02
-
7/29/2019 Guide to Start Business in India
7/28
7
Incorporated Structures or Limited Liability
Business Organisations
Organisaonsregisteredunderlawandwhosemembersenjoylimitedliabilityprotecontotheextentoftheircontribuon;areverypopularformsfordoingbusiness,allovertheworld.
Asthedocumentsofincorporaonandannualreturnsofthesebusinessenesarekept
inthepublicdomain,theoutsidersdealingwiththeseorganisaonsarealsoabletoknow
abouttheownersandtheircapitalcontribuonbeforeenteringintoatransacon.
BenefitsofIncorporatedBusinessStructures
Allovertheworld,incorporatedbusinessorganisaonsarepopularstructuresforcarrying
outbusinessacvies.Themainbenetsofthesestructuresaregivenbelow
PersonalAssetsProtection
Liabiliesofownersofincorporatedbusinessorganisaonsarelimitedtotheiragreed
contribuon.ItmeansashareholderofaCompanyorapartnerinanLLPonlyneedto
contributehisagreedshare.Aerhecontributeshisshare,heisnotliabletocontribute
addionalamountevenifthecompanyorLLPcreatesfurtherliabilityinitsname.
PerpetualSuccession
Anincorporatedbusinessconnuesirrespecveofchangeinitsowners.Itisbecause,as
perthelawanincorporatedbusinessisalegalpersondisnctfromitsowners.Sochange
intheownerswillnotaecttheexistenceofanincorporatedbusiness.Thisisnotthe
caseforapartnershiporsoleproprietorship.Ifapartnerresignsordies,itistheendof
thepartnershiprm.Sameisthecaseofasoleproprietorshiprm.
Credibility&Acceptance
Sinceinformaonabouttheowners,theregisteredoceandcapitalcontribuonetcare
availabletopublicvericaon;incorporatedbusinessesaremoreacceptabletogeneralpublicandprospecvetradepartners.
NameProtection
An incorporatedbusiness is registeredwith anameand the samenamewill not be
availableforregistraonforanyotherrm.
InvestmentandLoanavailability
Investorsalwayspreferanincorporatedbusinessasthesameisregulatedunderalaw.
Itsbusinessscopeandnancialinformaonetcareavailableforvericaonatanyme.
-
7/29/2019 Guide to Start Business in India
8/28
03 Company Form of Business
Companyisanincorporatedbusinessformwiththeliabilityofitsshareholderslimitedtothe
amountoftheircontribuontothesharecapital.ACompanyismanagedbytheBoardof
Directorselectedbytheshareholders.InIndiawehavetwotypesofcompanies;i.e.Private
LimitedandPublicLimitedCompany.Acompanyisaseparatepersonunderlawandcanhold
assetsinitsname,cansueandcanbesuedbyothers.
-
7/29/2019 Guide to Start Business in India
9/28
9
PrivateLimitedCompany
ThemainfeaturesofaPrivateLimitedCompanyare;
Minimumnumberofshareholdersrequiredforformaonare2withmaximumbeing50
APrivatecompanyrequiresminimum2directors
PrivateCompanycanrestrictthetransferofshares
PrivateCompanycannot takedeposits frompublic andneithercan it issueshares to
public
Manyoftherestricveprovisionsof theCompaniesActarenotapplicabletoprivate
companies
NameofaprivatecompanyshouldendwithPrivateLimited
TheminimumcapitalrequiredforformaonisRs.1Lac
PublicLimitedCompany
Usuallypubliccompaniesarebig companieswithmanyshareholdersorownedbyother
public companies.These companies are formed for pooling large resources frompublic,
banksandothernancialinstuons.Themainfeaturesofpubliccompaniesare;
MinimumnumbersofshareholdersrequiredtoformaPubliccompanyare7.Thereare
norestriconsonthemaximumlimit.
Apubliccompanyrequiresminimum3directors
AllprovisionsoftheCompaniesActareapplicabletothesecompanies
MinimumcapitalrequiredfortheformaonofapubliccompanyisRs.5Lacs
ApubliccompanycanissuesharesaercomplyingwiththerequirementssetbySEBI
(SecuriesandExchangeBoardofIndia)
CompanyRegistration
Anytwopersons(inthecaseofprivatecompany)orsevenpersons(inthecaseofpublic
company);bysubscribingtotheMemorandumofAssociaoncanformaCompany.Theyalso
needtocomplywithvariousprovisionsoftheCompaniesActforsuccessfulincorporaon.Theprocessofcompanyincorporaonisasgivenbelow,
ObtainDIN(DirectorsIdencaonNumber)fromMinistryofCorporateAairs
ApplyforanameforthecompanyandgetitalloedfromtheRegistrarofCompanies
(RoC)
PreparetheMemorandum&ArclesofAssociaonoftheproposedcompany
ApplyforincorporaonwiththeRoCwiththedulystampedMemorandum&Arclesand
otherforms
RepresentbeforetheRegistrarforcorreconinthedocumentsifrequired.
Ifalldocumentsareinorder,theRegistrarregistersthesedocumentsinhisrecordsand
issuetheCercateofIncorporaon.
-
7/29/2019 Guide to Start Business in India
10/28
ConceptofLimitedLiability
The conceptof Limited Liability is oenmisinterpreted. Limited liability means that the
personalnancial liability is limitedto theextentofaxedamountthatonehas agreed
toinvestinacompanyoralimitedliabilitypartnership.Inotherwords,theinvestorisnot
personallyliableforthebusinessdebtsandliabiliesoftheLimitedCompanyorLimited
LiabilityPartnership.Intheunfortunateeventofwindingupofthebusiness,theinvestors
liabilityislimitedtotheunpaidamountofagreedcontribuonbysharesorotherwise.On
thecontrary,theliabilityofsoleproprietorsandpartnersingeneralpartnershipareunlimited
andeventheirpersonalassetsareexposedtopayothebusinessdebtsandotherbusiness
liabilies.
TheDirectors run the day to day business of a Company and are liable to comply with
thevariousrequirementsspeciedunderlaw.InthecaseofanLLP,DesignatedPartneris
responsibleforthelegalcompliances.DirectorsandDesignatedPartnersarepersonallyheldresponsibleincaseofanynoncompliance.
UsuallyinasmallCompany,theshareholdersaretheDirectorsandinanLLP,thePartners
becomedesignatedpartners.IntheirroleasaDirectororDesignatedpartner,theirliability
isunlimited,astheyareexposedtopenalprovisionsunderthelawforthenoncompliance
ofrespecveregulaons.
-
7/29/2019 Guide to Start Business in India
11/28
ManagementandAdministrationofaCompany
A company is managed and administrated by its Board of Directors appointed by the
shareholders. Their powers, dues and responsibilies are guided by the provisions of
theCompaniesActandtheMemorandumandArcleofAssociaonexecutedduringthe
incorporaon.
Howdirectorsfunctioninacompany?
DirectorsarecollecvelycalledtheBoard.Allmajordecisionsofacompanyaretakenat
themeengoftheBoardofDirectors.AsperCompanylawminimumofonemeengofthe
Boardneedtobeconvenedineveryquarterandtheproceedingsofthemeengneedto
berecordedintheminutebook.Boardcanalsodelegatemanyofitspowerstoindividualdirectorsandemployeesthroughproperresoluons.
Whatarethepowersofshareholders?
Inacompany,thepowersofshareholdersarelimited.Theyhavethepowertoappointor
removedirectors.Theycanalsovoteonsomeofthepolicydecisionsneedingtheirapproval,
aspertheArclesofAssociaonortheCompanyLaw.Shareholderstakealldecisionattheir
meeng,andeverycompanyisrequiredbylawtoholdanAnnualGeneralMeeng(AGM)
everyyear.IffoundnecessarytheboardcanalsocallforExtraOrdinaryGeneralMeeng
(EGM)assomepolicydecisionsregardingtherunningofacompanycanonlybetakenbythe
shareholders.
11
-
7/29/2019 Guide to Start Business in India
12/28
CompliancerequirementsforaCompany
ThemanagementofacompanyisvestedwiththeBoardofDirectors.TheBoardofDirectors
managesthedaytodayaairsofthecompanysubjecttotheprovisionsoftheCompanies
ActandaspertheMemorandumandArclesofAssociaon.Thedecisionsatthemeengofdirectorsarecarriedbywayofresoluons.Therearecertaindecisionsthatrequirethe
approvalofshareholders.
TheBoardhastomeetleastonceinevery3monthsandatleast4meengsshallbeheldin
everyyear.Everyyear,thecompanyhastoconveneanAnnualGeneralMeeng(AGM)of
theshareholdersforadopngtheAnnualaccountsandtheAppointmentofauditorsforthe
followingyear.AspertheCompanyLaw,minutesoftheBoardandGeneralMeengsshould
bekeptinthecompanyrecordsandthesameneedtobesignedbytheChairmanofthe
meengs.
EverycompanyhavingapaidupcapitalofRs.5Croreormoreshallappointawholeme
CompanySecretaryandeverycompanyhavingapaidupsharecapitalofRs.10LacstoRs.5
CroreshallobtaintheSecretarialComplianceCercatefromaCompanySecretaryinwhole
mepracce.ThesamealsoneedtobeledwiththeRegistrarofCompanies.
CompliancemechanismunderCompaniesActmandateslingofReturns/FormstoRegistrar
of Companies (RoC) within prescribed me limits. Compliance related ling of returns /documentswiththeoceofRoCcanbebroadlyclassiedintotwocategories;
A.AnnualStatutoryCompliances
B.EventBasedCompliances
AnnualStatutoryCompliances
FilingofAnnualAccounts:
EverycompanyhastopreparenancialaccountsconsisngofBalanceSheetandProt
andLossaccountonayearlybasisandthesamehas tobeplacedbeforetheAnnualGeneral Meeng of the company. Copy of the Annual Accounts duly audited by a
CharteredAccountanthastobeledwiththeRegistrarofCompanies.
FilingofAnnualReturn:
EveryyearacompanyshallleareturnwiththeRegistrarofCompanieswithin60days
ofAGMcontaining the parcularssuchasaddressofregisteredoce, registerof its
members, register of its debenture holders, shares and debentures, indebtedness,
membersanddebentureholderspastandpresent,anddirectorsandmanagingdirectors
pastandpresent.
12
-
7/29/2019 Guide to Start Business in India
13/28
EventBasedCompliances
EventBasedCompliancesThefollowingarefewinstancesthatrequirealingofdocuments
withtheRegistrarofCompanies.
1. ChangeofNameoftheCompany
2. IncreaseinAuthorisedCapital/IssueofShares
3. Creaon/Modicaon/SasfaconofChargesontheAssetsofCompany
4. ChangeinRegisteredOceofthecompany
5. StatutoryMeengofaPublicLimitedCompany
6. ResoluonspassedbytheBoard/GeneralMeengsandAgreementsenteredbythe
company
7. AppointmentofDirectors/ManagingDirectorandchangesamongthem
Minutes/Registers/RecordsandCommonSealAcompanyisrequiredtomaintainandpreserveasetofrecordsasrequiredunderCompanies
Actasfollows:
1. Statutory Registers such as Register of Members, Register of Directors, Register of
DirectorsShareholding,RegisterofChargesetc.
2. ShareCercate
3. MinutesBook
4. CommonSeal
13
-
7/29/2019 Guide to Start Business in India
14/28
04 LLP form of Business
LimitedLiability Partnershipor LLP isa limited liability organisaon(body corporate) like
Limited Company. The major dierence of it from company is in its management and
administraon.LLPismanagedlikeapartnershiprmbasedonthetermsandcondions
detailedintheLLPagreement,givingpartnersthefreedomtomanagetheirbusinesswith
minimumoutsideinterference.Italsogivesmoreexibilityasexternalcompliancesareless
comparedtoacompany.LLPcanbeformedbyindividualsandbodycorporate(Company,
LLPorotherlimitedliabilityorganisaons).ThoughLLPisanewconceptinIndia,thistypeof
organisaonisverypopularallovertheworld.InUSAandMiddleEastcountries,thistypeof
business(knownasLLC)staredfunconingasearlyasyear1977.
-
7/29/2019 Guide to Start Business in India
15/28
LLPRegistration
An LLP can be formed by two persons (natural or legal persons) by subscribing to the
incorporaon document aer complying with other legal requirements. The process of
registraonisgivenbelow;
1. ObtainDirectorIdencaonNumber(DIN)ForEachDesignatedPartners
(MinimumTwo)
2. ApplyforanamefortheLLP
3. FileExecutedIncorporaonDocument
4. Ifalldocumentsareinorder,Registrarregistersthesedocumentsinhisrecordsand
issuestheCercateofIncorporaon.
5. FinaliseLLPAgreement
6. AerlingtheotherformsandagreementwiththeRegistrar,theLLPcanstartits
operaon.
ManagementandadministrationofLLP
ManagementofanLLPisdonebythepartnerssubjecttoLLPagreement.Unlikecompany,
theyhavethefreedomtomanagetheLLPandcandelegatepowerstoanyparcularpartner.
ItisadvisableforanLLPtotakealldecisionintheirmeengorbywrienconsent.
LLPisa legalentycreatedbylawandthusisdisnct from itspartners. Itis requiredto
keepa separatebankaccount for all itsbusinesstransacons.Allpaymentsandreceipts
shallbeinthenameoftheLLP.AnLLPneedstokeepproperbooksofaccountsforrecording
businesstransacons.Itisalsoadvisabletokeeprecordsofmajorbusinessdecisionstaken
bypartners,eitherintheformofminutesorintheformofwrienconsent.
CompliancerequirementsforLLP
Compliance mechanism under LLP Actmandates to le Returns / Forms to Ministry of
CorporateAairs(MCA)withinprescribedmelimits.Compliancerelatedtolingofreturns
/documentscanbebroadlyclassiedintotwocategories,1. AnnualStatutoryCompliances
2. EventBasedCompliances
AnnualStatutoryCompliances
FilingofAnnualReturn:
EveryLLPthatisregisteredbeforeSept30thofayearshallleareturnwiththeRegistrar
ofLLPwithin60daysofclosureofitsnancialyearcontainingtheparcularssuchas
addressofregisteredoce,detailsofpartners,designatedpartnersetc.
15
-
7/29/2019 Guide to Start Business in India
16/28
FilingofAnnualAccounts.
Every LLPhas tole aStatementofAccountsandSolvencywith theRegistrarof LLP
within30daysfromtheendofsixmonthsofthenancialyear.
EventBasedCompliances
FollowingarethefewinstancesthatrequirellingofdocumentswiththeregistrarofLLP
1. ChangeintheLLPAgreement
2. ChangeintheNameoftheLLP
3. ChangeinRegisteredoceaddressoftheLLP
4. AdmissionofPartners
5. Resignaon/DeathetcofPartners
WhyLLPisamoreattractivestructuretodoBusiness?
ThemainbenetsofLLPformare;
Limitedliabilityprotection
LiabiliesofPartnersInAnLLPislimitedtotheagreedcontribuon.IfXisapartner
inXYZLLPandifXagreedtocontributeRs10000intothecapitalofLLP,hisliabilityis
limitedtoRs.10000.HeisnotpersonallyresponsiblefortheliabiliesofXYZLLP.Sodoing
businessthroughLLPstructureprovidessafetytohispersonalassetsastheliabilityofLLP
shallnotbeextendedtohispersonalproperes.
Efficienttaxsavingbusinessform:
Intheeyesoftaxlaws,LLPisarmandhencermtaxaonisapplicabletoLLP.Various
taxesleviedonaCompanylikeDividendDistribuontaxandsurchargesarenotapplicable
toanLLP.TheprotaertaxfromLLPsoperaonwillbereectedinthepersonalincome
ofpartners.ItisesmatedthattheapproximatetaxsavingsofanLLPwillbearound17%
comparedtothatofacompany.
Management:
Incompanies,themanagementisvestedwithitsBoardofDirectors.Theyareresponsible
fortakingthedaytodaydecisionsandmanagementofacompany.Shareholdershave
limitedpowersintheaairsofacompany.InLLP,managementofLLPisvestedwith
partnersunlessspecicallymenonedintheLLPagreement.ItispossibleforanLLPto
delegateallpowersofmanagementtoasinglepersonexceptcompliancerequirements
undertheLLPact,whicharetheresponsibiliesofDesignatedPartners.
16
-
7/29/2019 Guide to Start Business in India
17/28
Lesscompliancerequirements:
Comparedtoacompany,thelegalcompliancerequirementsarelesserforLLPs.Fora
company,itismandatorytomaintainvariousregisters,minutesetc,butthereisnosuch
requirementforanLLP.
Auditofaccounts:
AllcompaniesarerequiredtoappointaCharteredAccountantasauditorsforauding
accounts,irrespecveofthesizeandoperaonofthecompany.IncaseofanLLP,the
auditrequirementstartsonlyiftheturnoverexceedsRs.40Lacsorcontribuonexceeds
Rs.25Lacs.
Lesscostofmaintenance:StatutorylingfeespayablebyanLLParemuchlesscomparedtoacompany.Soeven
smallbusinesscanthinkofincorporangtheirrmasrunningcostareverylow.
Flexibleownership:
ItispossibleforapartnerinanLLPtoresignsubjecttothetermsofLLPagreement.Aer
resignaon,usuallythepartnercantakebackhisshareofcontribuonfromtheLLP.
Managementflexibility:
LLP isfree to takeanybusiness decisions subject to the LLP agreement. Itcanenterinto a contract with its partner or relaves ofpartners and borrowandmake loans
to outsiders. But in a company structure, many of these decisions need either the
permissionof theshareholders orapprovalofgovernmentauthories, forwhich the
processiscumbersome.
Noownershiprestrictions:
Inaprivate company, the number of shareholders is limitedto 50. There isnosuch
restriconinthecaseofanLLP.AnLLPcanhaveanynumberofpartnersandthuscan
securemorecapitalforitsbusinessoperaons.
Greatercredibility:
ByvirtueofbeingaregisteredentyunderGovernmentlaws,registeringyourbusiness
asanLLP,willgainyourbusinessbeerlegimacyandgreatercredibilitywhendealing
withothercompanies,banksandpotenalbusinesspartners.
17
-
7/29/2019 Guide to Start Business in India
18/28
05
Basedonthenatureofitsbusiness,acompanyorLLPneedtotakeseveralotherregistraons
andcomplywithrespecvelawsoftheCentralandStateGovernments.
Other Registrations Required for a Company/LLP
-
7/29/2019 Guide to Start Business in India
19/28
PermanentAccountNumber(PAN).ThisisauniquenumberissuedbyIncomeTaxdepartmentfortaxling.Thisnumberis
mandatoryforallincorporatedbusiness.
TaxAccountNumber(TAN)
ThisnumberisissuedbyIncometaxdepartmentforlingTaxDeductedatSource(TDS).
Manyofthetransaconsrequirededuconatsourceandthisnumberisrequiredfor
propercompliance.
ServiceTaxRegistrationIf the company/LLP provides taxable services, and if the taxable turnover exceeds
Rs10lacs,colleconofservicetaxiscompulsory.Suchserviceprovidersneedtoregister
andobtainServiceTaxRegistraon.
ValueAddedTax(VAT)
ValueAdded TaxandCentral Sales tax registraon is compulsory for companies/LLPs
dealingintaxablegoods.Itisastatemaerandifthecompanies/LLPsoperatelocallyin
dierentstates,separateregistraonsarerequiredforeachstate.
ImportExportCode(IEC)
Import and Export Code number is compulsory for the companies/LLPs planning for
importandexportofgoods.
Shop&EstablishmentRegistration
AlltheocesofacompanyorLLPhastoberegisteredwiththelocallabourauthories
under therelevantshopsandestablishmentRegulaons.Generally this registraonis
requiredtobedonewithin30daysofopeningtherespecveoces.
19
-
7/29/2019 Guide to Start Business in India
20/28
06 Accounts & Audit
Accounng isthe lifebloodof anycompanyorLLPasbusinessdecisionsaremadebased
onaccounnginformaon.CompanyandLLPlawmandateskeepingbooksofaccountsand
records in accordancewith the Indian accounng standards. These requirements ensure
systemacpresentaonofaccounts,publicdisclosureandfullltaxaonrequirements.
-
7/29/2019 Guide to Start Business in India
21/28
20
Company:Accounts&Audit
Everycompanyneedstokeepitsbooksofaccountswithallsupporngdocumentsattheregisteredoceofthecompany.Thebookskeptshallbeclosedattheendofnancialyear
andaprotandlossaccountandbalancesheetshallbeprepared.
Aerclosingofaccounts,thebooksanddocumentsneedtobeauditedandshallbeled
withtheRegistrarofCompanies.Therequirementofauditisapplicabletoallcompanies
irrespecveofsizeandturnover.
LLP:Accounts&Audit
Likecompany,anLLPalsoneedtokeepthebooksofaccountsandpapersatitsregistered
oce.AnLLPisrequiredtocloseitsaccountson31 stMarchevery year. The audingof
accountsisonlyapplicableiftheturnoveroftheLLPexceedsRs.40Lacsorifthecontribuon
exceedsRs.25 Lacs.The accountspreparedevery yearshallbeledwithRegistraronor
before30thOctoberofthatyear.
-
7/29/2019 Guide to Start Business in India
22/28
07
ThetaxaonrequirementsspulatedunderlawisdierentforaCompanyandanLLP.Fewbriefpointsregardingthemajordierencesareexplainedintheparagraphsbelow.
Taxation
-
7/29/2019 Guide to Start Business in India
23/28
ForCompany
Everycompanyneedtopayincometaxonprotandsurchargesifapplicable.Theprot
aer tax can beused to declare dividend to shareholders aerpaying the dividend
distribuontax.Insimpleterms,thecompanyisliabletopaytaxonprotandagainon
protdistributedtoshareholders.
ForLLP
IncomeofanLLP, aermeengthebusinessexpenses andpartners remuneraon is
taxedatsuchratesasapplicableforeachnancialyear.Theprotaertaxbelongsto
partnersandthesameistaxfreeinthehandsofpartners.Varioustaxleviedoncompany
likeDividenddistribuonTaxandsurchargesarenotapplicabletoanLLP.
CompliancerequirementsunderTaxlaw
Thecompliancerequirementsundertaxlawsencompassboththeregularpaymentof
taxontheearningsandlingthenecessaryrecordswiththetaxauthoriesasperthe
prescribednocaonseveryyear.
AnnualtaxReturnfiling
TheCompanyorLLPhastoleIncomeTaxreturntotheIncomeTaxauthoriesevery
year.ThemelineforlingthereturnisJuly31st(incasewheretaxauditisnotrequired)
andSeptember30th(incasewheretaxauditisrequired)
TaxDeductedatsource(TDS)
IfanyCompanyorLLPmakesanypaymentswhichrequirestaxdeducons,thesame
shallbedeductedandpaidtotheGovernment.ThecompanyorLLPisalsorequiredto
lereturnsregardingdeducons.
AdvancetaxpaymentsThecompanyandLLPshallforecastitstaxliabilitybasedonitsincomeforecastedand
paythetaxtothegovernmentinperiodicintervals.
IndirectTax
Basedonthenatureofitsbusiness,acompanyorLLPisrequiredtopayvariousindirect
taxes. For service industries this is in the formofservice tax and for product based
industriesthisistheformofcentralexciseandValueAddedTax.
23
-
7/29/2019 Guide to Start Business in India
24/28
08
CompaniesInnthroughitsexperiencedbusinesssetupservicesandincorporaonconsulng
professionalshas advisedover5000 companiesand LLPs inthe last3years insengup
oftheirbusinesses.Ourvastexperienceinthelegaldomaincoupledwiththeeecveuse
of informaon technology ensures the mely delivery of serviceswith high professional
standardsatanaordableprice.Thisnewmethodofcompany/LLPincorporaonevolved
byourresearchteamhelpsanentrepreneurtonavigateeasilythroughthevarioussteps
required by law. The following factors contribute to our excellent and highly acclaimed
incorporaonandcomplianceservices:.
Experiencedteam:
Our experienced team have the experse to handle anyassignment for seng upa
Company/LLPinIndia.Thisincludesincorporaonofanewenterpriseorconvernganexisngbusiness(i.e.soleproprietorship,partnershipetc)intoaCompany/LLP.
Why choose Companiesinn.com to form yourCompany/LLP?
-
7/29/2019 Guide to Start Business in India
25/28
Lowcost:
CompaniesInnbusinesssetupservicesarepricedaracvelytomeettherequirements
ofentrepreneursandbusinessstartups.Useofstandardisedprocessesandinformaon
technologyenablesustoprovidetheserviceatcompevecosts,oenattherates
chargedbyothers.Moreoverourpricesarepredenedwithnohiddencharges.The
onlinepricecalculatorallowsyoutogetitemisedservicechargesincludingthestandard
Governmentfee.
Allservicesavailableunderoneroof:
TocomplywiththevariouslawsgoverningbusinessestablishmentsinIndia,aCompany
orLLPneedstoapplyforPANandTANNumbers(IncomeTaxDept.),Shops/Establishment
Registraon(Dept.ofLabour),ServiceTax(CentralExciseDept.),VAT(StateCommercial
TaxDept.)etcdependingonthenatureofitsacvity.Wecanhelpyoutoobtainallthese
cercatessothatyoucanfocusyourmeandenergiesonoperangthebusinesswhich
otherwisemightbeillspentinfollowupswithvariousGovernmentdepartments.
Continuedsupport:
Our associate rm CN Partners Consultants LLP has experience in corporate law
complianceandwillensuremelycomplianceofyourCompany/LLPslegalrequirements
atanaordableprice.
Taxcomplianceandaccountingservices:
OursisterconcernCN Business Solutons LLP,isabookkeepingandtaxlawcompliance
rm.ThisrmcanhelpyoumaintainyourCompany/LLPsaccountsandlethevariousreturnsasrequiredunderlawatanaordablecharge.
CompaniesinnHelpDesk:
RunningabusinessascompanyorLLPneedprofessionalhelpandadvise,tocaterthis
wehaveourhelpdeskforallourclients.Aerincorporaon,youcancallanymeduring
businesshoursormailtohelpdesk@companiesinn.comforanyhelporassistance.
CompaniesInn is the ideal partner for your business incorporaon and regulatory
compliance services. When youre ready to form your Company/LLP, visit us online at
www.companiesInn.com. Fill in the parculars about the Company/LLP you want to
registerandproceedtocompleteyourorder.Alternavelycallusatanyoftheanyofthe
CompaniesInn IncorporatonKiosk menoned on the back page to incorporate your
Company/LLP.
Aerreadingthisbooklet,ifanyofyourdoubtsregardingCompanyorLLPincorporaon
remainunanswered;callusormailtoinfo@companiesinn.com.Wewouldbedelightedto
provideanyaddionalinformaonregardingbusinessincorporaoninIndia.
25
-
7/29/2019 Guide to Start Business in India
26/28
NOTES:
HelpDesk:+918030255900
Email:info@companiesinn.com
-
7/29/2019 Guide to Start Business in India
27/28
NOTES:
HelpDesk:+918030255900
Email:info@companiesinn.com
-
7/29/2019 Guide to Start Business in India
28/28
delhi
bangalore
mumbai
chennai
kochi
CompaniesInn.com LLP#48, 100Ft Road, Opp to Kendriya Sadan, Koramangala, Bangalore - 560034
Phone: +91 80 3025 5900Email: info@companiesinn.comWebsite: www.companiesinn.com
hyderabad
pune
top related