Starting a business is the toughest decision one can take but it gives you the maximum fulfillment of your dreams and desires. Your decision to begin your entrepreneurial journey starts with the decision of selecting the right business structure to follow. Anyone can choose a private limited company to build a scalable business. It’s the most famous legal structure for the business with multiple benefits such as limited liability, separate legal entity, ease in share transfer etc.
Private limited company is governed by MCA (Ministry of corporate affairs) under Companies Act, 2013. Private limited company can be registered with minimum of 2 directors and 2 shareholders, where shareholder and director can be same person. The maximum number of directors can be 15 and the maximum members can be 200.
The shares division depends on the percentage of the capital amount invested in a company. The profit is also divided as per the share holding of the shareholders.
Key Highlights of Private Limited Company
- Limited Liability – The limited liability shields the share holders from personal liability and protects from other risks and losses.
- Attracts more vendors as well as employees
- Procures good investment from reliable investors.
- Increases the potential to grow and expand