What Are the Legal Steps to Start a Business in Pune, India?

There are several legal formalities to take care of when planning to start a new business in Pune, namely, tax obligations, financial regulations, and employment regulations. It is quite a challenging proposition to plan a new business in Pune, although it will offer great benefits in the long term. However, to set up a successful business in Pune, it is a must for an entrepreneur to understand the legal steps and comply with all the legal obligations. The most essential one is company registration at the right time. Read here about the steps to start a business in Pune:

1. Check the Availability of the Name of the Company

Before you register a company in Pune or any other part of India, it is necessary to check whether the proposed name is not being used by someone else. One can easily check the names of all the companies with similar names online. Make sure that your company name selected is unique and stands above your competitors.

2. Apply For Director Identification Number

How to start a business in Pune? You need to first purchase a director identification number. It is being allotted to existing or potential directors who have already incorporated their company in Pune. One can get the number easily by filling a DIN application online. After filling the form, it is being passed to the required authorities for verification of documents and information provided in the form.

3. Must Get a Digital Signature Certificate

To start a small business in Pune, you must have a digital signature certificate, which works as an electronic key for identifying the certificate holder. Any digital signature agencies registered and approved by the Indian government are liable to issue this certificate. The documents required to apply for a digital signature certificate are identity and address proofs of all the company directors.

4. Apply for an Incorporation Certificate to Start a Business in Pune

If you are thinking about how to start a small business in Pune? Then ensure to work on getting an incorporation certificate by approaching the Ministry of Corporate Affairs. This certificate acts as proof of the company’s constitution. E-forms, such as E-forms 32, 1, and 18, are available on the ministry website. A memorandum of articles and articles of association, stamped copy of power of attorney, and an application establishing the consent of directors are the required documents for applying for the certificate.

5. Create a Company Seal

Whether you are starting a business in Pune or somewhere else, the company seal should be present on each of the papers be it any official documents or shares of the company. The cost incurred in creating a company seal is based on the seal’s validity. Although it is not a mandatory legal step to follow for private companies, it helps in increasing the credibility of the company in front of its clients and prospective customers.

6. Get a Permanent Account Number

When planning or thinking of starting a business in Pune, secure a PAN card for the company by filling Form 49A. Sitting from the comfort of your home, you can get an e-PAN card in 48 hours and a physical copy delivered to your mentioned address in 15 working days.

7. Acquiring a Tax Deduction Account Number (TAN)

According to the Indian government, a tax deduction account number (TAN) is an important legal step in starting a business in any city. TAN is issued under the direction of the Income Tax Department of India to all those registered entities who are legally liable for tax deductions at the source. For getting a TAN, a company is required to file Form 49B with the nearest TIN facilitation centre. Post verification of the application, TAN is issued.

8. Stamping All the Documents for Credibility

Stamping of all the documents shared with the client, partners, or your present or prospective customers is essential to gain credibility for your business. Any unsigned copies or memorandum of association will have no credibility. Any of the businesses can easily get a stamp under the company’s name by paying stamp duty to the registrar of companies.

9. Apply for GST Registration

GST registration is a mandated legal step to follow for each of the companies that offer products or services in various Indian states. It is to be obtained at the time of company registration.

10. Get a Certificate from Pune/Maharashtra Municipal Inspector According to the Shops and Establishment Act

The name of employer, company, designation, permanent postal address, and category of business, all the information must be given to the state municipal inspector according to the Shops and Establishment Act. The inspector in return for the information issues a certificate. This is a vital legal step to start a business in Pune.

11. Apply for a Profession Tax Certificate from the Pune Profession Tax Office

Each employer, excluding the government officer, is legally entitled to taxation being an Indian citizen. If planning to start a business in Pune, a company is required to file Form 1 with their state’s Profession Tax Office for the same.

12. Completing the Registration With the National Employees' Provident Fund Organisation

Each of the employers is required to share their work details with the Employees' Provident Fund Organisation (EPFO) to get the ECN number. If the company has recruited over 20 people, then providing a TDS certificate to the employee is a must too. The information is shared by the EPFO in a prescribed format. The employer is required to do all the processes; no employee has to give a separate application.

Conclusion

Hope the above-mentioned legal steps would be of great help in understanding how to start a new business in Pune. We at OKcredit have years of experience in handling the accounts of businesses. It is one of the best digital ledger and payment reminder apps.

Also read:

1) Where to Get a Small Business License?
2) Legal Rights of Every Business Owner
3) What Are The Legal Requirements For Your Business Registration?
4) Ease of Doing Business in India -The Challenges & Opportunities
5) OkCredit: All you need to know about OkCredit & how it works.

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FAQs

Q. How to start a business legally in India?

Ans. Here are the steps to follow to start a business legally in India:

• Creating a business structure and founder’s agreement
• Apply for a license to run a business
• Understanding the accounting and taxation laws
• Make yourself aware of the labour laws
• Work on intellectual property protection
• Preparing business policies
• Get the business insured

Q. What are the general registrations related to starting a new business?

Ans. Here is the list of common registrations required to start a new business:

• GST registration
• Tax Account Number
• Permanent Account Number
• Shops and Establishment Act for physical premises to the commercial establishment
• Opening of bank account

Q. What is the first thing to take care of before starting any business?

Ans. Analysing the market competition, business licenses, permission from the required state, and evaluating the finance requirement are the primary things to consider before starting a new business.

Q. What is the capital required to start a new business?

Ans. The capital requirement is decided based on the business activity you are planning to carry on. The capital requirement differs between retail and wholesale business from a small- or medium-scale business. The best way to evaluate the capital requirement is by analysing future expense requirements.

Q. What steps are required to register a new business in any state of India?

Ans. For registering a new business in India, be it a promoter or owner, all have to finalise the capital and business requirements. Keep in mind things like a capital requirement, activity types, association, or partnership, and finally, the business structure.

Q. What factors to consider for choosing any of the business entities?

Ans. Choosing the right business partner, capital requirement, tax liabilities, compliance matters, and post-registration aspects are the crucial things to consider for selecting any business entity.

Q. What is GST registration?

Ans. GST registration is a procedure where taxpayers register their business under the GST Act. After the registration, a new business is assigned with a unique registration number known as GSTIN (Goods and Services Tax Identification number). It is a 15-digit number given by the Indian government.