People
are thinking that starting their own company is almost impossible in
India due to bureaucracy hazards. But this post explains the cost and
exact procedures for starting a company. If you have a viable business
idea then starting a company is not difficult. The World Bank’s Doing
Business project report 2008 has ranked India
at 120 among 178 economies,based on ease of doing business,and 111 on
starting a business. The project estimates that an average of 33 days is
required to set up a business in India and the process involves 13
basic steps though the licenses required
will vary depending on the type of business or industry.
These include the following steps:
1 Obtain Director Identification Number From the Ministry of Company Affairs:Takes one day ;no charges
2 Obtain electronic/digital signature certificate from authorised
cerifying agencies like Sify and TCS:Takes 4 days;Costs Rs 400 to Rs
2,650
3 Present name for approval to Registrar of Companies(ROC);get the
Memorandum (MoA)and Articles of Association (AoA)vetted by ROC and
printed: Takes 23days;Rs 50
4 Apply to the Superintendent of Stamps or an authorised bank for
stamping of the Memorandum and Articles of association:1 day ;Rs 200 for
MoA, Rs 1,000 for every Rs 5 lakh or part there of for AoA ,Rs 100 for
stamp paper
5 Present the requried documents and registration fees to RoC.
Documents needed include stamped copies of MoA and AoA, Copy of Form 32
along with consent letters of Directors of the Company, Form
1application and declaration for incorporating the Company, Form 18
address proof of the Company,Form 1Aevidencing name approval,copy of
challan of fee, Power of Attorney from subscribers on judicial stamp
paper of Rs 100 Identification of subscribers in the form of driving
license , passport, ration card or voter’s identity card. These
documents are to be uploaded online as well as filed in original with
the RoC.
The fees are determined by the amount of authorised share capital of the company.
For registration of a company whose nominal share capital does not exceed Rs 1 lakh: Rs 4,000
For registration of a company whose nominal share capital exceeds Rs 1 lakh:Rs 4,000,plus the following:
Rs 300 for every Rs 10,000 of nominal share capital or part of Rs 10,000 after the first Rs 1 lakh up to Rs 5 lakh
Rs 200 for every Rs 10,000 of nominal share capital or part of Rs 10,000 after the first Rs 5 lakh up to Rs 50 lakh
Rs 100 for every Rs 10,000 of nominal share capital or part of Rs 10,000 after the first Rs 50 lakh up to Rs 1 crore
Rs 50 for every Rs 10,000 of nominal share capital or part of Rs 10,000 after the first Rs 1 crore
The amount has to be paid by Demand Draft or Treasury Challan
6. Obtain a company seal: 3 day;Rs 350
7. Obtain Permanent Account Number from an authorised franchise or
agent appointed by the National Securities Depository Services Ltd:7
day;Rs 66 fee and Rs 5 for form (if not downloaded).The application is
to be made on From 49A along with a certified copy of the certificate of
registration issued by ROC as well as proof of identity and address.
The Income Tax Department has outsourced PNA allotment to UTI Investors
Services Ltd.
8. Obtain TAN (Tax Account Number) form the Assessing Officer in the
Concerned circle of the Income tax Department; 7 day (happens
simultaneously with step 7); Rs 55.TAN is mandatory on TDS/TCS
certificates.
9. Register with Kerala Shops and Establishments Act: 2 day (along
with steps 7& 8); Apply in form B 1 to Assistant Labour
OfficerGradeIII, along with the applicable fees.
The fee Structure is as follows:
For an establishment with no employees Rs 10
For an establishment with less than 5 employeesRs 50
For an establishment with 5 to 10 employees Rs 100
For an establishment with less than 20 employeesRs 200
For an establishment with 20 to 30 employees Rs 300
For an establishment with 31 to 50 employeesRs 500
For an establishment with 51 to 100 employeesRs 1,000
10. Register for value added tax, if applicable,before the Sales Tax
Officer of the ward in which the company is located:12 days (along with
previous step); Rs 5,000 as registration fee and Rs 100 as stamp duty.
11. Register for profession tax: 2 days,along with step 10; no charge
12. Register with Employees Provident Fund Organisation :2 days ,along with step 10; no charge.
This is optional if employee strength is less than 20.
13. Register with ESIC (medical insurance): 1 day ,along with step 10; no charge.
