Register Business in India – Structure Comparison

Created by Cheli

Evaluate Private Ltd., LLP, and Sole Proprietor options, understand costs, taxes, liability, and complete registration.

27 Items

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Published May 17, 2026

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Checklist Items (27)

Define business objectives

Clarify scale, capital needs, growth plans, and control preferences to guide structure selection.

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Assess need for external investors

If you plan to raise capital from VC or angels, a Private Ltd. is typically required.

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Determine desired governance model

LLP offers flexibility with partner‑managed control; Private Ltd. follows board‑based governance.

Compare incorporation costs

Estimate one‑time and recurring fees for each structure.

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Private Ltd. registration fee

Government fee ~₹7,000 + DSC/DPIN costs; professional fees ~₹15,000‑₹25,000.

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LLP registration fee

Government fee ₹500‑₹1,000 + professional fees ~₹10,000‑₹15,000.

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Sole proprietor licensing

No formal registration fee; may need Shop & Establishment licence (~₹2,000‑₹5,000).

Analyse tax obligations

Identify corporate tax rates, filing frequency, and GST applicability.

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Private Ltd. corporate tax

Flat 25% (≤₹400 cr turnover) or 22% with exemptions; mandatory TDS and annual return.

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LLP tax treatment

Taxed as partnership: 30% on profit; partners taxed on share of profit as personal income.

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Sole proprietor tax

Taxed under personal income slabs (up to 30%); easier filing but no tax‑saving corporate deductions.

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GST registration threshold

All structures must register if turnover >₹40 lakhs (₹20 lakhs for NE states).

Assess liability exposure

Understand how each form protects personal assets.

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Private Ltd. limited liability

Shareholders liable only up to unpaid share capital; personal assets generally safe.

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LLP limited liability for partners

Partners not liable beyond capital contribution, except for fraud or negligence.

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Sole proprietor unlimited liability

Owner personally liable for all debts and legal claims.

Decision framework

Score each structure against criteria and choose the best fit.

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Create scoring matrix

Assign weights to capital, control, tax, liability, and compliance burden.

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Populate matrix with data from prior sections

Use cost, tax rate, and liability notes to fill scores.

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Select highest‑scoring option

Document rationale for audit trail.

Prepare documentation

Gather all mandatory papers before filing.

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Director/partner ID proof

PAN, Aadhaar, and passport‑size photograph for each individual.

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Proof of address for entity

Utility bill or rent agreement for the registered office.

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Digital Signature Certificate (DSC)

Required for filing online with MCA; obtain from certified provider.

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Director Identification Number (DIN) / Designated Partner ID

Apply via MCA portal; mandatory for Private Ltd. and LLP.

File incorporation application

Submit forms and fees through MCA portal.

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Private Ltd. – File SPICe+ form

Include MoA, AoA, subscriber details, and payment of stamp duty.

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LLP – File FiLLiP form

Upload LLP agreement, partner details, and pay registration fee.

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Sole proprietor – Obtain shop licence

Apply at local Municipal Corporation; submit address proof and PAN.

Complete post‑registration compliance

Fulfill statutory obligations within first 30 days and ongoing.

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Issue share certificates (Private Ltd.)

Prepare and deliver certificates to shareholders; record in register of members.

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Obtain PAN and TAN for entity

Apply through NSDL; required for tax filing and TDS deductions.

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Register for GST

If turnover exceeds threshold or inter‑state supply, complete GST registration online.

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Set up statutory bookkeeping

Maintain cash book, ledger, stock register, and statutory audit schedule.

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Annual return and financial statements filing

File Form MGT‑7 (Private Ltd.) or Form 11 (LLP) and audited financials within 60 days of AGM.

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