How to Start/Register a Online Business in India

How to Start/Register a Online Business in India

Before talk about the registration first of all we divide the business in 2 Category :-

a) Product Based Business

Product Based Business include the business are like ecommerce, food tech startup, manufacturing or selling on marketplace. In Simple words where you wanna sell a product to consumer.

b) Service Based Business

Service based business are like Website Development, Marketing and IT Firms, Consultancy Services, Ecommerce Marketplaces model etc where you wanna provide service to clients.

So Lets talk about How to Register Product and Service Based Business :-

1. Sole Proprietorship Firm

Sole Proprietorship Firm is easiest way to starting a Online Business in India. Sole Proprietorship have no any legal Registration like other business entity so its need just some legal proof so any Online Business can open a current bank account on business name. so its purpose of the Sole Proprietorship Firm.

Advantages in Sole Proprietorship Firm From Online Business Point of View :-

a) Sole Proprietorship is the easiest way to starting the business in India and most of the business are running under this structure.
b) Its save business formation cost in the starting because its need just tax registration and some other small licenses.
c) Less Compliance because we have to file Just VAT/CST Returns and Income Tax Returns of the Individual.
d) Bearing Less Maintenance Charges.

Disadvantages in Sole Proprietorship Firm From Online Business Point of View :-

a) Sole Proprietorship Firm is not trustworthy so you can not getting funding easily.
b) Its a simple firm so big and growing business can not form Sole Proprietorship Firm.
c) you can not add the Partners in Simple Sole Proprietorship Firm.

2. Partnership Firm :-

Partnership Firm is also similar to Sole Proprietorship Firm.
Its need minimum 2 Partner to getting start the business. Partnership firm have also same features and disadvantages as we mentioned in the sole proprietorship firm.

3. Limited Liability Partnership Firm :-

Limited Liability Partnership is great option for Online Startups in India. In the Online Startups always have 2 partner so LLP is the best option to register a business in India. LLP require minimum 2 partner for the registration. LLP is introduce in april 2007 and its a mixture of the partnership firm and private limited company.

When startups have minimum budget as less than 10000 Rupees then LLP is the best option to register the startup. In the llp startup can enjoy most of the features of the pvt ltd company.

Features of the Limited Liability Partnership Firm:-

  • LLP is a body corporate and a legal entity separate from its partners;
  • The LLP will have perpetual succession;
  • The mutual rights and duties of partners of an LLP inter se and those of the LLP and its partners shall be governed by an agreement between partners or between the LLP and the partners subject to the provisions of the LLP Act 2008;
  • The LLP will be a separate legal entity, liable to the full extent of its assets, with the liability of the partners being limited to their agreed contribution in the LLP which may be of tangible or intangible nature or both tangible and intangible in nature;
  • Indian Partnership Act, 1932 shall not apply to LLP.
  • The mutual rights between the partners of LLP are governed by the LLP agreement.

4. Private Limited Company :-

Private Limited Company is one of the most popular business formation in India. In India most of the internet startups choose private limited company for the registration. Private Limited Company require minimum 2 Director or person for the registration. Private limited company also prefer by the angel investor or venture capital firms so for this reason internet startups choose Private Limited Company for their startup registration.

Features of the Private Limited Company

1. Limited Liability
2. Legal Entity/Status or Recognition
3. Perpetual Succession
4. Project Cost and Risk Factors
5. Easy Transferability
6. Dual Relationship
7. Borrowing Capacity
8. Taxation
9. Raising Money from Public


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