A private limited company is a smart option for starting up a business by startups and businesses with higher growth aspirations. At first, glance, setting up a private limited company might seem expensive, which is the reason why a lot of entrepreneurs do not incorporate one. But, the whole situation has changed now with the advent of online company registration. The transparent pricing and quicker procedures of registration than before offered by the Ministry of corporate affairs have led several businesses to start a private limited company.
The different kinds of company registration cost or the cost of starting up and operating a private limited company in India are mentioned below:
- Starting Up or Incorporation – The cost and complexity of company registration has been reduced in India, to some extent, with the help of online registration. However, as the prices vary from state to state, so make sure to be careful about it. Anyways, besides that, you will also have to include the charge of DSC, TAN, and PAN in it, which would be around 1,500 INR as well.
The professional fees, too, depending on the share capital of your company. However, on average, it stays between 2,000 INR to 5,000 INR.
- Business Registration: Irrespective of the type of your organization, you would require a proper Government-based registration. Previously, it was conducted through VAT and Service Tax Registration. However, after the implementation of GST, things have changed. Formerly, the cost of business registration used to vary from 15,000 INR to 30,000 INR. But, now, it has reduced to 10,000 INR to 20,000 INR. Nevertheless, the price would, further, depend on the state taxes and the overall complexity of the task.
The documents for company registration, in this aspect, will be –
- A self-attested copy of both Aadhar Card and PAN Card (of all the subscribers and directors)
- Passport-size photograph
- A self-attested copy of legal Identity Proof (either your Passport or Voter ID card or Aadhar Card or driving license)
- Proof of the address of the office (Utility Bill not older than 2 months and NOC from the owner of premises or Rent Agreement papers)
- Residential proof that isn’t older than two months (either your Electricity Bill or Mobile/Telephone Bill or Bank Statement)
- The e-mail address and the phone number of the director alongside some other basic details
- Sample signature of the Authorized Signatory for registering under Agile Pro
Now, the services for starting a business are integrated and can be done simultaneously in one step. By using an integrated e-Form SPICe+, anyone setting up a Pvt Ltd company can apply for the following services:
- Name reservation
- Incorporation of a new company
- DIN allotment
- Profession Tax (Maharashtra)
- Bank Account Opening
- PAN
- TAN
- EPFO
- ESIC
- GSTIN
- Mandatory Compliances: There are certain compliances laid by the Ministry of Corporate affairs which any private limited company is bound to obey. This includes the Appointment of a Statutory Auditor, Filing of form for Commencement of Business, Conducting of board meetings and its documentation thereof, Filing of Financial Statement & Annual Return, and KYC of Directors. The government fee in this aspect generally revolves around 2,000 INR. On the other hand, the professional fees generally vary from 5,000 INR to 12,000 INR per month.
- Event-Based Compliances – Event-Based compliances are to be done with the occurrence of certain events like change in directors, change of registered office, and change in authorized share capital, the rise of paid-up share capital, and so on. These events readily demand compliances to avoid any kind of additional penalties or other fees. The price for the event-based compliances generally depends on the compliances that you choose. Nonetheless, if you have to opt for the right professionals, then you may have to pay around 3,500 INR to 8,000 INR.
- Miscellaneous Compliances – There are certain aspects of a company that MCA keeps a track of. If any change takes place in any of those aspects, it is imperative that those changes are informed. Like the aforementioned compliances, this one, too, shall have a government fee and a professional charge. A private limited company can expect a professional fee of 1,500 INR onwards, depending on the complexity of the job.
- Accounting and Auditing – This cost is not just confined to private limited company registration. Any and every company registration must have their account books and audit files ready at all times. It is expected of a company to pay at least Rs. 5000 a month depending on the number of entries obviously. Though auditing is not mandatory for proprietorships and partnerships, it is compulsory for private limited companies. The annual cost for auditing would be around 15,000 INR to 20,000 INR.
It is to be remembered that apart from these things, there are also a few minimum needs for company registration which are as follows –
- Minimum of two Shareholders
- Minimum of two directors
- At least one director should be an Indian Resident.
Conclusion
Thus, starting up a company is one thing but successfully operating a private limited company needs dedication, time, and professional help. Company registration is a one-time cost but there are a lot of compliances that follow after which need to be taken care of.
