Welcome to one special article we’ve published on this blog of InstaSpaces. We are grateful for your awesome readers who venture into our site to get valuable information about virtual office spaces and other valuable business-related matters.
We want to provide you with special people with the best and always the right content. So we put together this article explaining the company and GST registration.
Well also guide you on the ways to obtain both of these registrations for your business using a premium virtual office space. So get ready for an expression of information headed your way.
Company Registration: what does it mean?
There are hundreds of business starting up each month. Some people start a business out of the main motive to earn money while some start business out of pure passion. Some even start-up businesses to fulfill a certain supply-demand gap in the market.
Whatever be the reason you are starting your business, getting your business legally registered has several benefits. Well, look at the advantages at a later stage, after we look at the types of business registrations available.
A company can be of different types, from the type of services they offer to the demand gap they fulfill. But the most basic classification of businesses is through their structure. There are 4 business structures in India as of now and they are listed down below.
One Person Company
Some people prefer to stand business as lone entrepreneurs, holding all the control structure through them. These are useful if there is only one owner or a single proprietor. They can carry on the business under this name and still reap the benefits of a corporate framework.
Limited Liability Partnership
It is the best type of partnership where the company is a mix of limited liabilities. Each person has liabilities of their own as stated in the agreement.
This is also favorable to shield you from the unpleasant or unauthorized actions of your other partners. This helps you give a flexible partnership approach that keeps you safe.
LLP will be a full functioning corporate body and a legal entity separate from its partners. Flexibility is one of the selling points of this type of organizational structure.
Private Limited Company
This company structure offers protection for its shareholders but places restrictions on its ownership. It is very easy to attract potential investors for funding and also has very high tax benefits.
But one drawback this structure faces is the number of restrictions it faces from the law point of view as shareholders are not allowed to sell their shares to anybody. This is put in place to prevent a hostile takeover of the company.
Public Limited Company
A special type of company structure that has limited liability and the ability to offer shares to the general public. These are the type of companies that trade on the stock market ( such as NSE and BSE ). A public limited company is followed by strict norms and has to publish its financial status to the general public in terms of annual and seasonal reports.
It is easy to gain capital with this type of approach as people buy its shares if the company performs well. This leads to more money that can be invested in your business.
How should you decide the right Business Structure for you?
Planning is a crucial part of any business. Let alone business, a set of plans is what makes life less risky to live daily. When you register your business for the first time, it is crucial to select the best structure that suits your goals and mission statements of the organization.
Here are some valid reasons to put thought into the selection of a business structure.
Income Tax Rates
The type of business structure affects the income tax rates by a great number. A sole proprietor has much less of a tax slab than a partnership. This is because the income of the business is added to the individual’s income and then tax rate calculated for it.
Attracting new investors
You also have to count in the fact of your business needing investment in the future. When you might need to attract new investors to gain valuable business capital, then it is best to go for structures like limited liability partnership (LLP) or a private limited company.
Initial Investments for your Business
The initial investment of business capital affects the business structure by a ton. If you can get all the initial capital to run the business by yourself, then getting a sole proprietorship or partnership seems pretty valid.
But when you need to raise capital to start a business, you will benefit much from LLP or a private limited company. You can get
No of Owners/Partners for your Business
There are many instances when business is started by a group of friends, who eventually saw the light in a crowded market. Some lone wolves have found pretty great business ideas, right out of their bedrooms.
Anyway, the no of people in a business affects its structure by a ton. It would be very necessary for you to consult with an expert before deciding this one.
So as you now have a pretty basic idea on company registration, well look at the various documents you might need to register your company.
Documents Required for Company Registration
The following are some of the prerequisites for company registration
- Registration on the MCA portal (Ministry of Corporate Affairs)
- Certificate of incorporation
- Digital signature certificate
- Director identification number
Now we’ll close the doors on company registration and talk more on GST registration.
GST Registration: what is GST and how is it important to my Business
Goods and Services Tax is a single indirect tax model for the entire country, brought into effect to subsume the various tax laws under the state and central government. GST is a destination-based tax model that is based on many stages. GST is levied on all these stages through the process of value addition.
So when you sell a biscuit packet from Haryana to the state of Karnataka. GST is collected and paid to the state of Karnataka. You can later claim your Input Tax Credit using this to get back your valuable business capital.
A short history of GST along with its advantages
Goods and Services Tax was brought into effect on 1 st July 2017 by the Indian constitutional government. It was brought along to subsume various taxes under it. An example of the subsumed taxes are.
Central taxes subsumed under GST
- Central Excise Duty (CENVAT)
- Additional Excise Duties
- Service Tax
- Additional Customs Duty
State taxes subsumed under GST
- VAT / Sales tax, Entertainment tax
- Luxury tax Taxes on lottery, betting, and gambling.
- Octroi and Entry Tax
- Purchase Tax
With all these tax laws now under a singe tax law, it has become easier for taxpayers and business people to pay their taxes per se.
Advantages of GST
Elimination of the Cascading effect of taxes:- GST is a single indirect tax system that has subsumed all the other tax laws under it. With GST in the fold, it has become easy and less costly for business while paying taxes. GST has [prevented the overlapping of various taxes over each other.
Higher Threshold level for Registration:- With GST the threshold level for business registering under GST has risen to a minimum of 20 lakhs. Before GST this limit was very near to 5 lakhs ( taking an average across all states of India ).
With this move from the government many small scale businesses were exempted from GST taxes.
Very convenient online procedure for Registration:- GST registration can be done through the online web portal of the government. All you need to do is submit the scanned digital copies of your attested business documents and your business will be GST registered by the government in a few days.
Better regulation of the unorganized sector:- Many industries before the GST era were highly unorganized. With GST laws into action, it becomes impossible to claim your input tax credit without a unique GST number for your business.
It brings together a lot of accountability into the business and as a result, brings the better organization.
Why should I register my Business for GST?
You should register your business for GST to claim the Input Tax Credit. You will also get your very own GST number enabling you to print your invoices as per the GST las of that state.
Also, this will help in improving your business, as everyone recommends a GST bill when hey buy a service from you.
So that’s about GST and company registration, well now let you in on the best ways to acquire GST as well as company registration.
What is the best and easy way of getting a company and GST Registration?
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All of these features come at an added cost that can be obtained by booking in advance.
These guys also offer excellent customer service which goes to show by their excellent clientele base and positive reviews all across.
So we’re done, my awesome readers. If you’ve come this far, do check out the services offered by Instaspaces by texting one of our Instabuddies on site.
Hope this article was helpful and informative.
Happy Office Hunting…