A private limited company is the one that is held privately for the small businesses. The liability of its members is limited to the amount of shares that they hold respectively and these shares cannot be traded publicly. Thus, if a private limited company faces loss, then the shareholders can sell their assets for payment but their personal assets will not be at risk. Registering a private limited company takes a lot less of legal formalities compared to a public company. The private companies do not have the compulsion to disclose information or need a minimum of seven shareholders while registering, unlike the public companies. The following are a few of the simple compliances that have to be undertaken to register your company as a Private Limited Company.
Members and directors
A min. of two and a max. of two hundred shareholders or members are needed for a company to be registered as a Private Limited Company, as per the guidelines of the companies’ act 2013. The company will also need to have a minimum of two directors to get registered as a Private Limited Company. Each director needs to have the Director Identification Number (DIN), which is issued by the Ministry of Corporate Affairs. One of these two directors must be an Indian resident, which means that he must have stayed in the country for more than 182 days in the previous year.
The name is one of the most important components when you want to register a company. This name consists of three parts, namely, the name, the activity, and the private limited company. All private limited companies need to use the words ‘private limited company’ after its name. The companies have to send at least five to six names for the approval of the registrar of the company. All of these names need to be expressive and unique. The names send for approval must not be similar to the names of any other company. Thus, selecting the name of a company is really important because it is something that will stay with the company for all its life.
The office address
The owners can use the temporary address of the company until the registration of the company. However, once the company gets registered, then the permanent address of the registered office must be provided to the registrar of the company. The registered office of the company is where the main and the majority of the affairs for a company are conducted and where all the important documents of the company are kept.
The digital signature
In the modern times, all the work is carried out online and the documents are all submitted electronically. Thus, every company needs to have a digital signature certificate that is utilized for verifying the authenticity of the documents. The directors should obtain the digital signature and mark every document with that digital signature.
The professional certifications
Any company has a number of professionals needed for various purposes. It is important to have the presence of all these professionals in the company to incorporate a private limited company certification. The professionals associated with the company like, chartered accountant, company secretary, cost accountants, and more are needed to have the certification during the time of the registration of the company.
One of the prime advantages of a private limited company lies in the fact that it is easy to register and operate. So, make sure you comply with the guidelines mentioned above when you decide to register your company. You can click here for steps involved in incorporation of a Private Limited Company.