Pre-investment and early stage startups
Many entrepreneurs get a private limited company registered without a second thought. A few things you need to watch out for at this stage:
- It is more important to have a written agreement amongst founders than incorporation right at the beginning.
- If you do incorporate, go for a simple no frills services who are also startup-friendly.
- Tax liability of the business: LLP can be much cheaper in terms of tax bills, and good for service, family, lifestyle businesses etc., especially when you don’t plan on raising any investment in the near future. If you are going to raise money anytime soon, you can still incorporate an LLP. You can always convert an LLP into a private limited and vice versa.
Doing almost any business in India, or even running any kind of office or establishment, requires several licenses.
- Some licenses are simple tax registrations.
- Some businesses just need a trade license or Shops and Establishment Registration. For some specific activities like manufacturing and export-import, you may need a bunch of licenses.
- For employing more than 10 employees, you may need various labor and employment related registrations.