An incorporated business (also called a corporation) is a type of business that offers many benefits over being a sole proprietor or partnership, including liability protection and additional tax deductions. Forming a corporation also allows you to raise capital through the sale of shares of your company.
Incorporation and management of companies in India have come a long way since 1956. The year 2013 marked a significant landmark with the introduction of the new Companies Act, 2013. The idea behind this new law was to ease the process of setting up a company and providing a more transparent legal system to the new generation of entrepreneurs.
Here in this article, let us understand what is company registration.
What is Company Incorporation?
Incorporations can be created in nearly all countries in the world and are usually identified as such by the use of terms such as “Inc.” or “Limited (Ltd.)” in their names. It is the process of legally declaring a corporate entity as separate from its owners.
- How company Incorporation works?
Incorporation has many advantages for a business and its owners, including:
- Protects the owner’s assets against the company’s liabilities
- Allows for easy transfer of ownership to another party
- Achieves a lower tax rate than on personal income
- Receives more lenient tax restrictions on loss carryforwards
- Can raise capital through the sale of stock
Throughout the world, corporations are the most widely used legal vehicle for operating a business. While the legal details of a corporation’s formation and organization differ from jurisdiction to jurisdiction, most have certain elements in common.
Note: For the Incorporation of a Company, a business has to check company name availability to ensure that the proposed name selected does not contain any word as prohibited under the Companies Act, 2013. You can conduct a company name check here.
Here in this article, we have understood the steps to incorporate a company, it will surely be useful for you to grow your business.