Private Limited Company Registration in Kerala

What is Private Limited Company Registration?

A Private Limited Company Registration refers to the formal process of legally registering a business as a private limited company under the regulatory framework of a country, typically governed by its corporate laws. In India, for example, the registration is carried out under the Companies Act 2013 through the Ministry of Corporate Affairs.

Here are the key features of a Private Limited Company:

• Limited Liability: Shareholders’ liability is limited to the amount of shares they hold, protecting their personal assets.
  

• Separate Legal Entity: The company is considered a distinct legal entity, separate from its shareholders and directors.
  

• Ownership: A private limited company restricts the transfer of shares and limits the number of shareholders, typically between 2 and 200.
  

• Perpetual Succession: The company continues to exist regardless of changes in ownership or management, ensuring its longevity.
  

This structure is highly popular among startups and businesses seeking credibility, ease of raising capital, and structured governance.

Who Can Register a Private Limited Company in Kerala?

A Private Limited Company can be registered by any individual or group of individuals, subject to certain eligibility criteria. Here are the private limited company registration eligibility criteria:

1. Minimum of Two Shareholders

   There must be at least two shareholders. These shareholders can be individuals or legal entities (such as other companies). The maximum number of shareholders allowed is 200.
   

2. Minimum of Two Directors

   At least two directors are required to register the company, and one of the directors must be a resident of the country where the company is being registered (for example, in India, one director must be a resident of India).
   

3. Indian and Foreign Nationals

   Both Indian citizens and foreign nationals (including NRIs and foreign residents) are allowed to register a private limited company. However, they must comply with the rules governing foreign ownership, such as obtaining the necessary approvals.
   

4. Legal Entities

   Apart from individuals, other legal entities, such as companies, LLPs (Limited Liability Partnerships), or trusts, can also register and own shares in a private limited company.
   

Benefits of Registering a Private Limited Company in Kerala

Registering a private limited company in Kerala provides the legal framework, security, and opportunities needed for business success in a vibrant market. Here are some advantages of a registered company.

1. Limited Liability Protection

   Shareholders’ personal assets are protected from business liabilities, limiting their risk to the amount they have invested in the company.
   

2. Separate Legal Entity

   The company enjoys a distinct legal identity, allowing it to own property, incur debt, and sue or be sued independently of its shareholders.
   

3. Ease of Raising Capital

   Due to their formal structure and credibility, private limited companies have greater access to funding from investors, venture capitalists, and banks.
   

4. Perpetual Existence

   The company’s existence is unaffected by changes in ownership or management, providing stability for long-term operations.
   

5. Tax Advantages

   Companies enjoy various tax deductions and exemptions compared to other forms of business, which can reduce the overall tax burden.
   

6. Increased Credibility

   Clients, investors, and partners often consider registered companies more reliable, leading to stronger business relationships.
   

7. Business Expansion Opportunities

   Registering in a major commercial hub like Kerala provides access to a vast market, a skilled workforce, and a robust ecosystem of suppliers and service providers.
   

8. Ease of Transferability

   Ownership in a private limited company can be transferred by selling shares, providing flexibility for business growth or exit.
   

Documents Required for Registration of a Private Limited Company in Kerala

To register a private limited company in Kerala, you need the following documents:

1. Identity and Address Verification:

   • Acceptable identification documents such as Passport, Aadhar card, Voter ID, or Driver's Licence.
     

   • Proof of address using documents like Utility bills or Bank Statements.
     

2. Proof of Registered Office:

   • Ownership documents like an Electricity Bill or Corporation Tax receipt in the owner's name serve as evidence for the registered office.
     

   • In instances where directors do not own the office, a mandatory No Objection Certificate (NOC) from the owner is required.
     

3. Memorandum of Association (MOA)

   The MOA outlines the foundation of the company, specifying its objectives and scope of activities.

4. Articles of Association (AOA)

   The AOA sets out the internal regulations and governance of the company.

5. Declaration and Consent Forms for Proposed Directors

   • Form DIR-2 (Consent to Act as Director): This is the written consent from the proposed directors agreeing to serve as a director of the company.
     

   • Form INC-9 (Declaration by Directors): A declaration from each proposed director stating they are not disqualified from becoming a director under the Companies Act, 2013.
     

Company Registration Process in Kerala

The process of company registration in Kerala is a comprehensive process designed to establish a new business entity in compliance with legal and regulatory frameworks. This involves interactions with various authorities to facilitate a smooth and lawful establishment of the business. Here is a detailed breakdown of the key steps:

1. Step 1: Apply for Digital Signature Certificates (DSCs):

   Digital Signature Certificates (DSCs) for all Directors involved in the company are essential for filing documents with the MCA. The DSC can be obtained from certifying authorities like eMudhra, Sify, or NSDL.
   

2. Step 2: Company Name Selection and Approval through SPICe+ Part A

   Select an appropriate and unique company name and obtain MCA approval for the same by submitting the SPICE+ Part A. You can propose up to two names in the application, and the MCA will approve the name based on availability and compliance with naming guidelines.
   

3. Step 3: Draft the MOA and AOA

   Once the name is approved, the Memorandum of Association (MOA) and Articles of Association (AOA) need to be drafted. These documents define the company's objectives, scope of activities, and operational rules.
   

4. Step 4: File Incorporation Forms (SPICe+) Part B

   The SPICe+ form is a single application form for the incorporation of the company. You will need to upload all required documents like:
   

   1. MOA and AOA

   2. Identity and address proof of directors and shareholders

   3. PAN and TAN applications (can be done through SPICe+)

   4. Declaration by directors and shareholders

   5. Proof of the registered office address

5. Step 5: Payment of Fees and Stamp Duty

   After filling in the required forms and attaching the necessary documents, the government fee and stamp duty must be paid, which varies based on the company’s authorised capital and the state in which the company is incorporated.
   

6. Step 6: Certificate of Incorporation (COI) Issuance

   After a thorough review by the authorities, the Certificate of Incorporation (COI) is issued, marking the official registration of the business. This document signifies the establishment of the company as a distinct legal entity.
   

7. Step 7: Open a Bank Account in the Company’s Name

   Select a bank that offers services suitable for your business needs, and gather essential documents. Once you submit these documents, the bank will verify them and activate your account. This account is essential for handling company transactions, such as payments and expenses, and managing business finances.
   

The specific procedures may vary for different types of companies. Depending on the characteristics and industry of the business, there may be additional steps and compliance obligations.

Selection of a Company Name in Kerala & Trademark Process

Before initiating the company registration process, it is advisable to conduct a thorough search for company registration name availability to ensure adherence to MCA guidelines for your chosen name and trademark.

Try our free search tool to instantly find company name availability and verify trademarks, domain names, and social media handles linked to your business name in a single click!

Searching for a company name?

Check company name availability using our powerful name search tool.

Explore details like Company Identification Number (CIN), Allocation status, Incorporation date, and the current state of an existing company. A quick company registration name check equips you with comprehensive information, enabling well-informed decision-making.

GST Requirements for Business Registration in Kerala

Goods and Services Tax (GST) registration of a company in Kerala, like any other location in India, is a fundamental requirement for businesses engaged in the supply of goods or services. The GST framework has streamlined the indirect tax structure in the country, and compliance is crucial for businesses to operate legally. 

Businesses with an aggregate turnover exceeding the prescribed threshold limit, which may vary, are required to register for GST. The threshold limit is generally ₹40 Lakhs (for goods) and ₹20 Lakhs (for services). 

Certain businesses, such as all e-commerce operators, are obligated to register under GST, regardless of turnover. Voluntary registration can be beneficial for businesses looking to avail themselves of an input tax credit.

To commence the GST registration for a private limited company, follow these steps:

• Visit the GST Portal.
  

• Click on "Register Now."
  

• Fill in the details in the "Part A" form.
  

• Complete "Part B" by entering business information and uploading essential documents such as PAN, Aadhar, business registration papers, bank statements, and photographs of proprietors/partners/directors.
  

• Submit the application, which then undergoes a verification process.
  

• Upon approval, you will receive your GST registration certificate.
  

The GST Certificate includes a GSTIN, a 15-digit state-wise identifier for businesses. The first 2 digits of the GSTIN denote the GST code of the respective state/territory, with Kerala being represented by the code 32.

Example of GSTIN for Kerala: 32AAQFB1222C1ZU

GST compliance is critical for businesses to ensure smooth operations and avoid legal complications. It involves adhering to a set of regulations, including timely registration under GST, issuing GST-compliant invoices, and accurately filing monthly, quarterly, or annual returns. Businesses must also keep track of their tax liabilities, file regular GST returns, and maintain detailed records of transactions to meet audit requirements. Proper compliance ensures the ability to claim Input Tax Credit (ITC), which helps reduce tax liabilities and boosts profitability. 

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Our package includes:

• Company Name Registration
  

• 2 Digital Signature Certificates (DSCs)
  

• 2 Directors’ Identification Numbers (DINs)
  

• Certificate of Incorporation(COI)
  

• MoA & AoA [Applicable for Private Limited Companies and OPCs]
  

• LLP Agreement [Applicable for LLPs]
  

• Company PAN & TAN
  

Company Registration Authorities in Kerala

1. Ministry of Corporate Affairs (MCA)

   At the central level, the Ministry of Corporate Affairs establishes the regulatory framework for company registration and governs corporate affairs across India. 
   

   The MCA website provides online services for company registration and compliance. It also gives access to vital reports and benefits from diverse services in various domains by registering through the official portal. 
   

2. Ministry of Micro, Small and Medium Enterprises(MSME)

   The Ministry of Micro, Small, and Medium Enterprises (MSME) is a government agency responsible for formulating and implementing policies, programs, and schemes for developing and promoting micro, small, and medium enterprises in India.
   

   It aims to facilitate the growth and sustainability of these enterprises, fostering entrepreneurship and economic development at the grassroots level.
   

   While not compulsory, opting for MSME/ Udyam registration is a beneficial move for MSMEs in India. It provides official recognition and simplifies access to various government schemes and support mechanisms. 
   

   If your business falls under manufacturing, service industries, or wholesale and retail trade, you can apply for MSME registration, subject to meeting the eligibility criteria based on annual turnover and investment.
   

3. Registrar of Companies (RoC)

   Operating under the Ministry of Corporate Affairs (MCA), the Registrar of Companies (RoC) oversees and regulates the activities of businesses in India. Its responsibilities include approving the registration of new companies and limited liability partnerships (LLPs). 
   

   The RoC's vital function involves ensuring compliance among incorporated entities. This includes overseeing processes like director appointments and resignations, appointing auditors and company secretaries, and managing obligations such as filing annual returns, submitting financial statements, and adhering to post-incorporation compliances.
   

   The current details of RoC (as of October 2024) for the Kerala:

   • ROC Ernakulam
     Email- roc.ernakulam@mca.gov.in  
     Address- Registrar Of Companies, Corporate Bhawan, BMC Road, Thrikkakara,
     Kochi - 682021, Kerala
     

4. Government of Kerala

   Based on the nature of the business, the Government of Kerala may play a role in issuing essential licences and permits for specific activities involving liaising with local authorities for trade licences and facilitating Professional Tax registration for businesses.
   

   The state government actively collaborates with other regulatory bodies in developing and executing industrial policies that influence the registration and expansion of businesses.
   

   • The Kerala State Industrial Development Corporation (KSIDC) provides assistance to new businesses and promotes industrial growth in Kerala. They assist companies in setting up and expanding their operations within the state by providing guidance on regulatory clearances, funding, and incentives. KSIDC is the nodal agency for Ease of Doing Business initiatives in the State.
     

   • Kerala introduced a Single Window Clearance Act to enable Ease of Doing Business way back in 1999. The online clearance mechanism (K-SWIFT) is aimed at facilitating clearances from departments/agencies concerned with setting up and running an enterprise in the State. It also oversees the registration for Professional Tax, 
     

   • The Registration Department handles firm registration in Kerala through the Electronic Governance for RegistratiOn Of Partnership Firms & Societies (Egroops) portal. 
     

   • In Kerala, the Labor Commissionerate under the Department of Labour and Skills regulates establishments under the Kerala Shops and Commercial Establishments Act.
     

   • The Local Self Government Department (LSGD) in Kerala manages and coordinates the state’s local governance structures. A Trade License is a mandatory registration required for all businesses at their Local Self Government Department (LSGD).
     

5. Income Tax Department

   The Income Tax Department plays a vital role in the registration process, particularly in matters related to obtaining a Permanent Account Number (PAN) and Tax Deduction and Collection Number (TAN) for the company.
   

   Businesses involved in insurance, financial services, broadcasting, and defence-related services must secure additional approvals and clearances from specific regulatory bodies. 
   

   This includes obtaining consent from entities such as the Reserve Bank of India (RBI), the Insurance Regulatory and Development Authority of India (IRDAI), the Securities and Exchange Board of India (SEBI), and the Ministry of Defence, among others. These approvals are crucial for ensuring lawful and secure operations within these industries.
   

Types of Companies You Can Register in Kerala

In Kerala, as in the rest of India, you can register several types of business structures. The choice of business structure depends on factors such as the nature of the business, scale of operations, ownership, and liability considerations. 

Here are the common types of companies that can be registered in Jaipur:

1. Private Limited Company

   A Private Limited Company is privately owned and regulated under the Companies Act, making it a popular choice for startups and businesses.

   

   Register your Private Limited Company in just ₹1,499 + Govt. Fee

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2. Limited Liability Partnership (LLP)

   An LLP, created under the Limited Liability Act 2008, offers limited liability and is often preferred by professionals and service providers.

   

   Register your Limited Liability Partnership in just ₹1,499 + Govt. Fee

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3. One Person Company (OPC)

   An OPC merges Private Limited Company features with Sole Proprietorship benefits, offering a single individual a separate legal entity with limited liability protection.

   

   Register your One Person Company in just ₹1,499 + Govt. Fee

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4. Public Limited Company

   A Public Limited Company is a regulated business structure with limited liability that offers shares to the public for fundraising. It is ideal for large-scale multinational corporations.

5. Sole Proprietorship

   A Sole Proprietorship is ideal for small businesses and freelancers. It features a single owner who is personally liable for all business obligations and minimal compliance requirements.

6. Partnership Firm

   Under the Indian Partnership Act, a Partnership involves two or more individuals jointly sharing responsibilities, profits, and liabilities.

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Checklist for Company Registration in Kerala

To register a private limited company in Kerala, you must follow the procedures the Ministry of Corporate Affairs (MCA) laid down. Here’s a comprehensive checklist to ensure you have all the necessary documents and steps covered:

• Obtain DSC for all proposed directors & shareholders

• Propose up to two company names & submit them for approval

• Draft the MOA

• Draft the AOA

• Complete & submit the SPICe+ form for company incorporation

• Attach the MOA, AOA, identity/address proofs, DSC of directors & other required documents

• Pay the requisite fees and stamp duty

• Get a Certificate of Incorporation (COI)

• Open a bank account