Things to do after Company Registration in India
Company registration is the process of legally incorporating a business entity so that it can operate as a separate legal entity under the laws of a particular country or jurisdiction. In India, the process of company registration is governed by the Companies Act, 2013, and is overseen by the Ministry of Corporate Affairs (MCA) and the Registrar of Companies (ROC).
Company born as artificial person with certain features like perpectual succession, rights, liabilities, powers etc. Shareholders are the owner of company and management undertaken by Board of Directors of company.
After registering a company in India, there are several important tasks and compliance requirements that you need to fulfill to ensure your business operates legally and smoothly. Here are some of the key things to do after company registration in India:
10 things to do post incorporation of Company:
- Obtain a Certificate of Incorporation:
This is the first step after registration. Once your company is registered, you will receive a Certificate of Incorporation from the Registrar of Companies (RoC). This certificate serves as proof of your company’s existence.
- Open a Bank Account:
Open a separate bank account for your company’s financial transactions. This account should be in the company’s name and is necessary for managing the company’s finances.
- Appointment of the first auditor:
For the appointment of the first auditor of a company, needs to file form ADT-1. It is a form that needs to be filed with the Registrar of Companies (RoC) under the provisions of the Companies Act, 2013. The first auditor is typically appointed until the conclusion of the first Annual General Meeting (AGM) of the company. Subsequently, the shareholders of the company will appoint as per the provisions of Companies Act, 2013.
- Commencement of Business:
The INC-20A form in India is known as the “Declaration for Commencement of Business. The purpose of this form is to declare that the company has commenced its business operations and has started its commercial activities. The company must file the INC-20A form within 180 days from the date of its incorporation. It is important to meet this deadline to avoid penalties and compliance issues.
- Issue Share Certificates:
Issue share certificates to the shareholders within two months of the company’s incorporation. Share certificates serve as evidence of ownership.
- Conduct Board Meetings and AGM:
Hold the first board meeting of the company within 30 days of incorporation. Additionally, convene the first Annual General Meeting (AGM) within six months of incorporation. companies are required to conduct at least four board meetings in a year, with not more than 120 days between two consecutive meetings and also comply with other provision of companies Act related to Conduct of Board Meetings as well as Annual General Meeting.
- Maintain Books of Accounts:
Start maintaining proper accounting records and books of accounts as required by law from the date of incorporation. Maintaining a bank account for your business is essential for managing your company’s finances, conducting transactions, and complying with financial and legal requirements.
- Employee Compliance:
If you have employees, ensure compliance with labor laws, including employment contracts, payroll, and employee benefits. Register your company under the applicable labor laws, such as the Employees’ Provident Fund (EPF) Act, the Employees’ State Insurance (ESI) Act, and the Professional Tax Act, depending on the number of employees and your location. Deduct and remit EPF and ESI contributions from employees’ salaries as required. Non-compliance with labor laws and regulations can result in legal issues, penalties, and damage to your company’s reputation.
- Disclosure of Director’s Interest and Declaration Regarding Disqualification:
Directors of a company are required to make disclosures regarding their interests and declare any disqualifications as part of their duties to ensure transparency and compliance with corporate governance norms.
Directors are also required to make declarations regarding their eligibility and disqualifications to serve as directors of a company. This declaration is typically part of the appointment and annual return filing process.
- GST Registration
If your business is involved in the sale of goods or services, you may need to register for Goods and Services Tax (GST). The registration threshold varies by state. GST (Goods and Services Tax) registration is mandatory for certain businesses and individuals, regardless of their turnover such as Interstate Supply, Casual Taxable Person, Reverse Charge Mechanism, E-commerce Operators, Tax Deducted at Source (TDS), Input Service Distributor (ISD), Special Economic Zone (SEZ) Units and Developers.
Conclusion
Compliance by a company after incorporation is not just necessary but also legally mandated in many jurisdictions, including India. Compliance refers to adhering to the various rules, regulations, and statutory requirements set forth by the government and regulatory authorities to ensure the proper functioning, transparency, and accountability of the company.
Non-compliance with legal and regulatory requirements can have significant consequences for a company. The severity of these consequences can vary depending on the nature of the non-compliance.
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