Anyone can start a business but it’s important to follow all the procedures and get all registered with all the Government departments for proper functioning. There a number of benefits you will get if you have registered your business with all the required authorities.
There are a lot of procedures that you will have to perform to run a legitimate business.
Filing Business Tax Returns
As an entrepreneur, it is important for you to show the profits of your business and pay taxes for the same. Businesses also have to pay Advance taxes every quarter of a year.
GST Registration And Filing
As per the new norms, it’s mandatory for a business to get a GST registration. If you provide any type of goods and services then it’s mandatory for you to get registered. GST Returns vary from Industry to Industry but whatever the case you are required to file GST Returns anyways.
Filing TDS Returns
Any payment made by a business, whether it’s the salaries or any other kind of payment, it is done after deducting the tax from the amount. The tax deducted is basically TDS which has to be paid to the Government and A return must be filed for the same.
Filing ROC Return
Same as above, every company needs to file for ROC Returns which is basically a balance sheet of all the profits, loss of the year. Every company that is registered under the Companies Act 2013 or under the earlier Companies Act 1956 is required to file annual returns to the Registrar of Companies.
The above-mentioned points are the mandatory procedures which are to be followed by any company. Apart from that, there are various benefits of getting your company registered with all the necessary Government departments.
Positives of Limited Liability
Limited personal liability is one of the most common reasons businesses become corporations. A corporation is a distinct legal entity, so incorporating protects the business owner’s personal assets, even if the corporation is in debt or facing other liabilities.
Registration Provides a Tax Benefit
Owners of corporations are only taxed on their own salary and bonuses, but you will also need to know how dividends are taxed. There are also other tax benefits that are available to some corporations, including insurance premium deductions, deferred tax payments, and income splitting.
Gives Business Credibility
When a business has completed the process of becoming incorporated, it can make a favorable impression on investors, making it easier to raise capital. Plus, in some cases, there is perceived permanency and reputability on the part of clients or customers when a business is a corporation.
Allows for Stock Incentives
One of the defining elements of a stock corporation is the stock structure, which gives board members and employees a share in the ownership of the company. This can be an attractive benefit for employees and can lead to higher employee retention rates.
Your Perpetual Existence
Unlike a sole proprietorship, a corporation continues to exist even if the owner passes away or leaves the business. A corporation will remain in existence until the shareholders take measures to dissolve it, or until the corporation is merged with another business.
Since a corporation is not tied to its owner, ownership can be transferred to another by selling stock. This is typically governed by the corporation, which can set limits on the transfer of stock, and the laws of the state where the corporation was formed.