Starting a business in India: legal requirements

When it comes to business, an individual should wisely choose the business structure in which he should be venture effectively and efficiently.
Businesses like sole proprietorship, partnerships, public limited company, OPC etc. should be considered to need the legal documents required.

Legal requirements to start a business may include the following :

1. Coming up with the business name

Choosing business name for your business is one of the greatest task to do. A business babe should match the venture, it should also be as creative as the venture’s business idea. Ensure that no other entity claimed your business name as same as yours. The name of the company shall be registered by the register  of companies of the state. The owner who is starting a business should choose four names where there’s should be no existing name. The last words should contain “private ltd” for private companies, “private” for public companies. Register of the companies take a week within the submission of the application regarding the desired name.

2. Get EIN from IRS

Any company or a cooperation or a partnership who has employees should have EIN (employer identification number) and it’s compulsory. The easiest mode of applying to EIN is through online. EIN identifies your company for tax purpose like a social security number where you can open a bank account for your business and apply for license. If you’re a sole proprietor, then EIN is not required.

Apply with the link below :

Apply for an Employer Identification Number (EIN) Online | Internal Revenue Service

Hours of Operation Monday to Friday, 7 a.m. to 10 p.m. Eastern Standard Time.

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3. Owner’s agreement should be done

This document acts as an agreement which acts like a legal documents where it provides rights, ownership, responsibilities and other terms to the founder between the company. It also important details regarding the venture and the founder of the business.
Some documents includes as the following:

• GST registration
• Permanent Account Number
• Tax Account Number
• Bank Account
• Halal registration
• FSSAI registration
• IEC code
• Other licenses which are required for the other kinds of business

4. Should require proper business permits and license

Just like other businesses, an individual has to obtain required licenses and permits. Federal levels should be licensed when you locate your business in a particular place. Federal license are required for the business where the business is involved in any sort of supervised activity. It varies according to the locations.

5. Be sure of the relevant tax regime and the accounting norms

Taxes is very important part of the business. Every business needs to pay tax like central tax, state tax, local taxes etc., different business attracts different taxes, knowing which tax implies which will be very useful and helpful for the business and the business owner. For this proper sound payment and invoicing system is necessary
There are versions of startup schemes and initiatives of the central government called startup India which aims at startups by tax holidays.
With the proper knowledge and good practice one can maintain proper books for accounts and audit them for time to time.

6. Know labour laws

Labour laws are very important at fir starting a business. Even the very small business is subjected by the law. It corrects the wrongs between the worker and the employer. They help to improve the social status of the business. The FLSA includes the minimum wage structure for every employee equally with the federal law. These laws govern most of the issues like wages, holidays, payment etc., it is recognized as the company hires people for the business which is subject to the several labour laws.

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