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INTIATING OF AN BUSINESS – COMPULSORY REQUIRES INCORPORATION OF A COMPANY —- NO

Yes, In today’s modern era, if an entrepreneur wants to start its business, then there is no requirement for him/her to set up a Company i.e. PRIVATE LTD COMPANY / PUBLIC LTD COMPANY and to spent a lot of money for incorporation or compliance pertaining to it.

DRAWBACKS OF COMPANY

REGISTRATION OF A PRIVATE AND PUBLIC LIMITED COMPANY is not only a solution for start – up of a business, as it leads to several disadvantages viz;

  • REGISTRATION PROCESS
  • COST EXPENSIVE
  • COMPLIANCE HURDLES
  • DIVISION OF OWNERSHIP
  • CLOSURE COST

Sometimes Certain Business like working with Foreign Companies, Under Startup India Programme, Or any Other Goverment Scheme it is Compulsory for Company or LLP registration.

Otherwise You can Process as under:

KEYS TO OVERCOME ABOVE DRAWBACKS:

If an Entrepreneur is setting up its own business then it can be set up by simplified process i.e. SOLE PROPRIETORSHIP.

If more than one entrepreneur wants to set up a business jointly then the option available is of PARTNERSHIP BUSINESS.

BENEFITS OF SOLE PROPRIETORSHIP

  •  EASY TO ESTABLISH
  • NO MAJOR ANNUAL COMPLIANCE
  • FLEXIBILITY IN OPERATIONS
  • NO ASSETS BIFURCATION
  • TAX ADVANTAGES
  • FULL CONTROL & OWNERSHIP STATUS.
  • QUICK DECISION & PROMPT ACTION
  • MAINTENANCE OF BUSINESS SECRETS
  • IF BUSINESS NOT WORKED THEN EASY AND COST EFFECTIVE TO CLOSE THE BUSINESS.

BENEFITS OF PARTNERSHIP

  • LESS REGISTRATION COST
  • FLEXIBLE TO MANAGE
  • NO MAJOR COMPLIANCE
  • TAX BENEFITS
  • GREATER BORROWING CAPACITY
  • IF  BUSINESS NOT WORKED THEN EASY AND COST EFFECTIVE TO CLOSE THE BUSINESS.

CONCLUSION

From the above, it’s very clear that, if an entrepreneur is at just a Initial level then he/she shouldn’t go for formation of a PRIVATE / PUBLIC LIMITED COMPANY, should start its business as a Sole-proprietor or a Partnership Business and later on a for a Major development or for expansion it can be taken at a next level to a Private Limited Company.

Read More About Business Structures in India – Click Here

Author: Taxwix

Taxwix – Making Your Idea Happen Taxwix.com has a team of experts like, CA, CS and Lawyers etc having the great dominance in field of the Corporate Compliance along with Advisory,Taxation and Finance. Taxwix team guides the Startups with their Idea and help help them to take ahead in the Legal Manner, helps in proper managing the business with accurate and timely Compliance. Taxwix has as simple 5 Step process to be followed to complete compliance

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