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Private limited company registration
A private limited company is the most common business structure in India for startups and growing businesses. It needs at least two members and two directors, and the liability of its owners is limited to the money they put in. ISPEED prepares and files the incorporation forms with the Ministry of Corporate Affairs (MCA) and hands you the certificate of incorporation, PAN and TAN.
What you get
- Digital signature certificates for two directors
- Director identification numbers for two directors
- Company name approval from MCA
- Memorandum and articles of association drafted and filed
- Certificate of incorporation
- PAN and TAN of the company
- Help with opening the company bank account
For whom
- Founders who plan to raise money from investors
- Two or more people starting a business together
- Businesses that want limited liability and a formal structure
Time
7 to 10 working days
Professional fee
From Rs. 3,999
plus government fees. Plus GST at 18 percent on the fee.
What it costs all-in, in your state
Government fees and stamp duty change by state and by authorised capital. This adds them to the professional fee so you compare on the real number.
Estimate
Private limited company in Maharashtra
Professional fee
Rs. 3,999
Private limited company registration, professional fee
Fixed fee. GST is added below.
Rs. 3,999
Government fees (estimate)
Rs. 5,475
Digital signature certificate, 2 people
Rs. 1,500 per person. Class 3, valid for two years.
Rs. 3,000
Name reservation
SPICe+ Part A. Two proposed names per application.
Rs. 1,000
MCA filing fee (SPICe+, MOA, AOA)
MCA charges no filing fee for authorised capital up to Rs. 15 lakh.
Rs. 0
Stamp duty on the SPICe+ form
Rs. 100
Stamp duty on the memorandum (MOA)
Rs. 200
Stamp duty on the articles (AOA)
AOA at Rs. 1,000 for every Rs. 5 lakh of authorised capital. Minimum Rs. 1,000, maximum Rs. 50,00,000.
Rs. 1,000
PAN application
Applied with the incorporation form.
Rs. 110
TAN application
Rs. 65
GST
Rs. 720
GST at 18 percent on professional fees
No GST on government fees or stamp duty.
Rs. 720
All-in total
Rs. 10,194
Government fees are estimates and are confirmed before filing. The professional fee is fixed.
- Registered office in Maharashtra. Stamp duty follows that state's schedule on the filing date.
- Authorised capital of Rs. 1,00,000.
- 2 directors. DSC is priced per person and is valid for two years.
- SPICe+ allots DIN for up to 3 directors at no separate fee.
- Government fees are estimates and are confirmed before filing. The professional fee is fixed.
- Based on authorised capital and the number of people entered. Change either and the estimate updates.
- Valid for 30 days.
What it is
A private limited company is registered under the Companies Act, 2013 and regulated by the Ministry of Corporate Affairs (MCA). It can have a minimum of two members and a maximum of two hundred members. The company is a separate legal person from its owners.
The liability of shareholders is limited. If the company cannot pay its debts, banks and creditors can recover from the assets of the company but not from the personal assets of the directors or shareholders.
Startups and growing businesses prefer this structure because it makes it easier to raise outside funding, it limits the liability of shareholders, and it lets the company offer employee stock options to attract good people.
Requirements
- At least two shareholders and two directors. The same two people can be both.
- At least one director must have stayed in India for 182 days or more during the financial year, as required by section 149 of the Companies Act, 2013.
- No minimum paid-up capital. The earlier requirement of Rs. 1 lakh was removed by the Companies (Amendment) Act, 2015.
- A registered office address in India, with proof of address and a no objection certificate from the owner of the premises.
- A digital signature certificate (DSC) for every director who signs the forms, and a director identification number (DIN) for every director.
- A unique name that is not the same as or similar to an existing company, LLP or registered trademark.
Benefits
- Limited liability: only the money invested in the business is at risk. The personal assets of directors and shareholders stay safe.
- Transferable shares: a shareholder can transfer shares to another person. This is far easier than transferring an interest in a proprietorship or a partnership.
- Higher credibility: banks, customers and vendors take a registered company more seriously, which makes it easier to borrow, raise capital and win contracts without personal risk.
- Perpetual succession: members can join or leave without affecting the existence of the company.
- Borrowing capacity: a company can issue secured and unsecured debentures, and banks and financial institutions generally prefer lending to a company over a partnership firm or a proprietorship.
- Tax treatment: the company is taxed on its profits, and salary paid to working directors is a deductible expense for the company.
Advantages and disadvantages
| Advantage | Disadvantage |
|---|---|
| Limited liability for shareholders | Statutory audit is compulsory regardless of turnover |
| Easiest structure for raising investment | Compliance cost is higher than an LLP or an OPC |
| Shares can be transferred | At least four board meetings and an AGM every year |
| Perpetual succession | Annual ROC filings in AOC-4 and MGT-7, plus DIR-3 KYC for every director |
| Better borrowing capacity | Cannot invite the public to buy shares, and members are capped at 200 |
How it happens
- 01
Apply for digital signatures
The incorporation forms are filed online and signed digitally, so the process starts with a DSC for each director. You send a photo, identity proof and address proof, and complete a short video verification as required by the Controller of Certifying Authorities.
- 02
Get director identification numbers
A DIN is a permanent number issued by the Registrar of Companies to each director. Under the Companies Act, 2013 no one can hold office as a director without a DIN. For a new company, DINs for up to three directors are allotted through the SPICe+ incorporation form itself. Directors who already hold a DIN use their existing number.
- 03
Reserve the company name
The name must be unique and must not be the same as or similar to an existing company, LLP or trademark. Up to two proposed names are filed in Part A of the SPICe+ form. The Registrar has discretion to approve or reject a name. An approved name is reserved for 20 days, within which the incorporation forms must be filed. ISPEED advises you on the name before filing so that rejection is unlikely.
- 04
Prepare the incorporation documents
The memorandum of association (MOA) records the name, objects, the state where the company is registered, the authorised capital it can raise, and a declaration that the company is limited. The articles of association (AOA) set out the internal rules. The promoters sign the MOA and AOA, which are filed with the Registrar along with declarations from the directors and subscribers.
- 05
File for the certificate of incorporation
SPICe+ Part B, the MOA, the AOA, the AGILE-PRO-S form and the declarations are filed together with MCA. Once approved, the Registrar issues the certificate of incorporation with the corporate identity number (CIN). PAN and TAN are allotted along with the certificate. The certificate is conclusive proof that the company is registered.
Documents you will need
- Two colour passport size photographs of each director and shareholder
- Identity proof of each director and shareholder: Aadhaar card, passport, driving licence or voter ID card
- Address proof of each director and shareholder: bank statement or passbook, electricity bill, telephone bill or any other utility bill, not older than two months
- PAN card of each director and shareholder. The name must match the income tax database.
- Proof of the registered office address: sale deed, electricity bill, property tax receipt or any other utility bill
- No objection certificate from the owner of the premises where the registered office will be located
Documents checklist
Private limited company
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Questions
What is the minimum number of members in a private limited company?
Two. A private limited company needs at least two members and at least two directors. It can have up to two hundred members.
Who can become a member of a company, and how?
An individual, another company (if its MOA allows it), a cooperative society or a trade union can be a member. A person becomes a member by subscribing to the MOA, by buying shares, by transfer, by becoming a beneficial owner, by giving a guarantee, or by applying in writing and being entered in the register of members.
Can a foreign national be a director or start a company in India?
Yes. A foreign national can be a director once a DIN is allotted, and can incorporate a company if they hold a digital signature for filing the incorporation forms and annual compliances. At least one director must be resident in India.
Is there a minimum share capital?
No. There is no minimum share capital for registering a company. Most small companies start with an authorised capital of Rs. 1 lakh, which can be increased later.
Does every director need a digital signature?
Under the Companies Act, 2013 every director who signs e-forms needs a DSC so that MCA can verify the documents filed. In practice every director should hold one.
What must the company do right after incorporation?
Display the company name, registered office address, CIN, telephone number, email and website (if any) outside the registered office and on letterheads. Open a bank account, deposit the subscription money and file the declaration of commencement of business in form INC-20A within 180 days. Hold the first board meeting and appoint the first auditor within 30 days.
People also need
Limited liability partnership registration
Register an LLP under the LLP Act, 2008 with limited liability for partners and fewer filings than a company.
plus government fees
One person company registration
Register a one person company so a single owner gets limited liability and a separate legal entity.
plus government fees
Annual ROC compliance
Keep your private limited company, OPC or LLP in good standing with every annual ROC filing done on time.
per year for a private limited company; LLP annual filings from Rs. 18,000
Tell us what you are starting.
You get the all-in price, the government fee for your state and the list of documents the same day. Then you decide.