What is Private Limited Company?

What is Private Limited Company?

A business entity which is privately owned. Private Company limits the liability of the members to the amount of the shares held.

Benefits of Private Limited Company Registration

If you have applied for the Private Limited Company Registration be sure of its various benefits as follows:

1. The shares of the Private Company are privately held and not in public domain. 

2. The minimum no.  of members requirement is 2

3. Compliances for incorporating and operating a Private Limited Company is a cumbersome process because of the various relaxations granted by the Government because of the non involvement of the public in the Company

4. The disclosure requirements in Private Limited Company are less in comparison to other Companies

5. The decision making is fast among the privately held entities

Compliances for Private Limited Company After Its Incorporation

I. Secretarial compliances 

Routine based compliances:

1. Within 30 days of the private limited company formation India, the company needs to call Board Meeting and appoint the Statutory Auditor in the Board meeting. Rest of the Board meetings to be held within 120 days gap.

2. The company shall issue the share certificate in respect to the shares allotted within 2 months from the date of Incorporation 

3. Private Company shall maintain the statutory Registers and records of the Company

4. The Directors of the Company shall disclose to the Company about his interest in the other entities

5. Company shall hold its first AGM within 9 months from the date of closure of the first financial year 

6. Company shall file its financial statements within 30 days from the date of AGM and Annual Return within 60 days from the date of AGM

7. Authority shall be granted to the person for undertaking the various responsibility as per secretarial standards

8. Company after its incorporation shall open its bank account for depositing the money received from the subscribers for subscription

Others are event based compliances under which Government has granted no of exemptions and privileges to Private Limited Company

II. Tax based compliances

1. Filing of IT return of a Private Limited Company at the It department

2. Conducting tax audit if the turnover of Private Limited Company exceeds 2 crores in an FY and submission of the report by 30 Sept of the relevant FY 

3. Minimum alternate tax to be payable @ 18.5% of book profits of Company 

4. Payment of advance tax if the advance tax payable in an FY is 10,000 or more.