Want to start your own business?

Want to start your own business?

Want%2Bto%2Bstart%2BBusiness

 

The first thing which hits the mind of every entrepreneur’s that how to start the business? We think that starting up a new business is very difficult but it is very simple. You just need to know some important information about your business idea. You should know the type of entity whether it is a private limited or LLP, Partnership or One Person Company. If you want to register any of the entities, find the information on how to start your own business? To reach out at the correct business decision all you need to know basic concepts about each business structure. 

There are various kinds of business structures in India some of them are:

  1. Sole Proprietor
  2. Partnership Firm
  3. One Person Company
  4. Private Limited Company
  5. Public Limited Company
 

Features of Sole Proprietorship

Single owner
Profit/Loss is owned by the owner only
The liability of the owner is limited
No legal formalities as compared to Partnership or Company
Ease of formation
Proprietor and the business are the same in the eyes of the law

 

Features of Partnership Firm

It requires minimum, 2 members to form a partnership and maximum, 10 members to form a partnership in the case of banking and 20 in other cases
Unlimited liability
Profit is shared among the partners on the basis of the agreed ratio
Registration is not mandatory but advisable to register it
All partners can act together or one partner can act on behalf of others


Features of One Person Company

It has only one person as a member who will act in the capacity of a director as well as a shareholder
Under the Companies Act, it is classified as a Private Company.
It is similar to a Private Company. It can be easily incorporated without many formalities and with just one person
Minimum paid-up capital for One person company is one lakh rupees and maximum paid-up capital is fifty lakhs

Features of Private Limited Company

It is owned privately by the individuals
More flexible and easy to form as many provisions of the Companies’ Act 2013 are not applicable to this
It can be formed with just 2 members and 2 directors but restricted to 200
The number of shareholders is limited to 50 only
A private company cannot invite the public to apply for its shares
This is more preferred by investors because they can buy/sell stakes easily

Features of Public Limited Company

A Public Limited Company is owned by the public or in which the public can subscribe
Capital
can be raised from the public directly through issues of shares
For a Public Limited Company, Minimum 3 directors and 7 shareholders are required.
No limit on the maximum number of shareholders
Shareholders have limited liability to the extent of the face value of their shares and premium respectively
——-

–Shweta Joshi

 
 

Leave a Comment