A Guide to Starting a Business in India
Starting a business can often feel challenging and exhausting. Yet, successfully executing this venture can prove immensely beneficial for both your company as well as for the economy of the country that you choose for your operations.
India, with its huge population and constant technological advancements, is one of the most desirable business hubs across the world. In this blog, we will be covering the fundamental steps regarding starting a business in India.
Starting an Indian Business:
Step 1 – Check if your chosen company name is available:
Before you proceed towards company registration, it is essential to ensure that your proposed business name is actually available. You can do this over the internet through the MCA 21 site, which allows applicants to check if their preferred company name is available. After your company name is approved, you should be able to see it on the website.
Step 2 – Acquiring a DIN (Director Identification Number):
A DIN is a unique identification number provided to the potential or current directors of a business that has been incorporated in India. You can fill an online form called the DIN-1 to obtain a temporary DIN.
You will then have to print the DIN-1 form, put your signature on it, and forward it to the relevant ministry along with proof of address and identity. Once the documents have been verified, the ministry will approve the form and provide you with a fixed DIN.
Step 3 – Getting a Digital Sign Certificate:
This certificate is an electronic key that is issued for the purpose of validating and identifying the certificate’s holder. The certificate can be issued by any approved agency that is affiliated with the relevant ministry. While applying for the certificate, you will need to submit the application form, proof of identity, and proof of permanent address.
Step 4 – Obtaining the Incorporation Certificate:
The Ministry of Corporate Affairs will issue the incorporation certificate, and will use it as proof that the company has been constituted. In order to apply for the incorporation certificate, you will have to digitally file the below forms on the official website of the Ministry of Company Affairs:
Alongside form 1, you will be required to provide a copy of your company’s MoA (Memorandum of Association) and AoA(Articles of Association) to the Registrar of Companies. In addition, you will also need to submit the director’s consent, along with a stamped photocopy that establishes the PoA (Power of Attorney).
Once you have completed these formalities, the incorporation certificate will then be forwarded through e-mail to the ID that you provided at the time of submitting the incorporation information.
Step 5 – Forming a seal of the company for all official documentation:
Company seals are required for sharing official documentation such as certificates. The precise cost of getting a company seal will depend upon how many words are engraved on the seal, how many seals are to be issued, and how urgently do you want the seals to be delivered.
Remember that, if you are forming a private Indian company, maintaining a seal is not mandatory for you.
Step 6 – Stamping the company documents:
The application containing your incorporation documents must always be accompanied by MoA and AoA copies. These copies must be attached with the receipts of payment for the two documents. These documents are to be stamped, and the stamp duty needs to be paid through the internet to the companies’ registrar.
Once this application has been submitted, you will get all your copies back by the Superintendent, and one of the copies will be signed, stamped, and embossed officially. Finally, your company promoters will need to sign the Memorandum and Articles of Association, and add all the required information themselves.
Step 7 – Acquiring a PAN (Permanent Account Number):
In order to apply for a PAN, you must file Form 49A. After acquiring a distinct PAN, you will receive a physical PAN card – note that this card will be sent to the registered address via an official post. While it is possible to apply for PAN over the internet, you will have to physically send all the mandatory documents for verification.
Step 8 – Acquiring a TAN (Tax Account Number):
According to the Indian government, the country’s income-tax department issues a TAN to every entity that must either collect or deduct tax at source.
Getting this number requires you to fill form 49B and submit it to any TIN Facilitation Center. After verifying your application, the form will be sent to the income-tax department, where your TAN will be issued. You can either apply for a TAN through NSDL’s website or make an offline application.
Step 9 – Getting a certificate through the Municipal Inspector/State under India’s ‘Shops and Establishment Act’:
You will have to submit a statement to the State Shop and Establishment Inspector, that contains the names of the managers or employers, the designated name of the company, the fixed postal address, and the category of business. Along with this statement, you will also have to pay any applicable fees. Remember that this step must be taken within 30 days of initiating your business.
Step 10 – GST Registration:
Getting registered for GST is required for all entities:
Make sure to register for GST before processing for any other company registration. This link contains additional information regarding GST registration, including the documents that you will require.
We hope that this guide to starting a business in India will help take some of the uncertainty and stress out of the entire process, and make sure that you get your new Indian business up and running in a smooth and swift manner. For customized help, visit us at: www.aadmi.com.