Choosing the Right Type of Company for Your Business in India

Updated on Friday 06th April 2018

One of the first decisions that have to be taken when starting a company in India refers to the legal entity under which the respective business will operate on the local market. India provides a set of business forms, similar to the ones available in other jurisdictions. The decision regarding the legal structure of an Indian company should be taken in accordance with the capital the investors have, the obligations and liabilities they want to assume or the size of the business they want to operate here. Our team of consultants in company formation in India can offer legal assistance for choosing a legal entity suitable for a specific business registered here. 


Registering an Indian sole trader 

The Indian sole trader represents the simplest form of doing business in this country. At the same time, if the business fails, the winding up procedure is much simpler than in the case of other business forms
The procedure on how to form a company in India for a sole proprietorship stipulates that this business form can be set up by a single investor, who is performing business activities in his or her own name. Our team of representatives in company formation in India can advise on the advantages of a sole trader
The company will need to be represented by a corporate bank account, a requirement imposed to other business structures available here, as well as to register for value added tax, but only in the situation in which the company reaches a certain income threshold. This business form is usually the best option in the case of small businesses

Register a partnership in India  

Another business form that is usually employed in India is the partnership. Its succcess is given by the simple registration procedure. India provides two types of partnerships, as follows:
partnership registered under the Partnership Act 1932;
limited liability partnership, registered under the Limited Liability Partnership Act 2008
A partnership in India is generally set up by an Indian citizen residing in India, but foreign investors may also set up this business form, after having received permission from the local institutions. 
Businessmen are invited to contact our team of specialists in company registration in India for in-depth assistance on how to choose a suitable legal entity.