Starting a business is the most challenging decision, but it gives you the maximum fulfilment of your dreams and desires. Your decision to begin your entrepreneurial journey starts with selecting the proper business structure. Anyone can choose a private limited company to build a scalable business. It's the most famous legal structure for the industry with multiple benefits such as limited liability, separate legal entity, ease in share transfer etc.
A private limited company is governed by MCA (Ministry of corporate affairs) under the Companies Act, 2013. A private limited company can be registered with at least two directors and two shareholders, where shareholders and directors can be the same person. The maximum number of directors can be 15, and the maximum number of members can be 200.
The shares division depends on the percentage of the capital invested in a company. The profit is also divided as per the shareholding of the shareholders.
Key Highlights of Private Limited Company
- Limited liability shields the shareholders from personal liability and protects them 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