Nine Documents You Need To Start A Business In India
Want to start a new business? But there's one thing that keeps you back every time you try to get the ball rolling; where do I start? Do I have all the documentation I need to ensure I have a working business?
In this blog, we will discuss the business documents needed to run a business.
Founders agreement
A founder agreement is a formal contract signed between all co-founders of a company. This document states all the responsibilities, ownership and initial investment of each founder of the company. It is recommended that a founder agreement be reached during the establishment of a company, as it will clarify the responsibilities and roles of each co-founder. It is also advisable to have a written format for this document.
Shareholder agreement
Behind any operating company, there are many pillars of investment. These pillars are called shareholders. They acquired some of their shares in the company in exchange for their money. Basically, this means that shareholders become one of the owners of the company and have certain rights in the key decision-making process. A shareholder agreement is a legal document drawn up between the company and its shareholders. It lists the acquired rights, powers and regulations. It ensures that no rules are violated and reserves rights.
This document provides a clear understanding of the relationship between the company and its shareholders. In the long run, this will help resolve any disputes that may occur more quickly and ensure smooth collaboration.
Certificate of incorporation
Just as every person is required to obtain a birth certificate, each company is required to obtain a registration certificate for itself. A Certificate of incorporation is a legal document that makes the creation of a company legitimate or brings the company into existence.
No objection certificate (NOC)
No objection certificate(NOC) is a legal document that is issued by any company, individual or corporation. Contains a list of items to which the signatory has no objection.
This document is used by companies in employment, trade, immigration, partnerships, and more. This legal document can be used for or against in court. The declaration of non-objection usually contains basic details of the parties involved and it is addressed to whosoever is concerned.
You can get a NOC template for yourself that your business lawyer or legal expert can use regularly. You can print it on stamp paper or plain letterhead.
Company PAN card
The Permanent Account Number (PAN) is a must-have record for anybody who falls under the jurisdiction of the taxpayer. This means that it could be an entity, a single owner, a partnership or a private limited company. If it's an Indian company or a foreign company, you need to register and have a PAN card.
TIN number
The Tax Identification Number is a unique number assigned to a company by the commercial tax department of the state where the application is filed. It is an 11-digit number that serves as the identity of the company that is registered for VAT on goods and services. Documents required for TIN may vary between state.
Non-disclosure agreement
Non-disclosure agreement creates trust between signatories. You can use it to protect any kind of information you want to share, but you want to keep it confidential. It is always useful if your company contains an innovative idea or know-how. This legal document is also commonly used when presenting a new idea or product to investors or in contracts with third parties, ie contractors, distributors.
If you have not entered into a nondisclosure agreement, you may risk losing intellectual property rights to the product and brand. People or companies with whom you share your business ideas can share them with others and even implement them themselves. As a result, you may be exposed to competition and encounter information leaks that could lead to the loss of potential investment opportunities.
GSTIN
Each taxpayer is assigned a 15-digit state taxpayer identification number for goods and services (GSTIN) based on the PAN. A GSTIN is required by the government for companies with an annual turnover of more than 20 lakh. If you are a Registered Merchant, you must file a GST refund and pay if there is a GST liability. In addition, GSTIN also helps when you want to take advantage of a loan to finance your business.
Employment Agreement
Needless to say, as your business begins to grow, you will need an employment contract for each new employee. The employment contract will define the role of the employee, but most importantly, it will limit the employer's liability. It is necessary to introduce such a solution because, in the absence of a written contract, the default legal provisions that favour employees will apply. Do not forget to take into account the types of staff you may wish to hire (ie Intern, Consultant, Contractor) as a different type of employment contract will be needed in each case.
With this, you're going to have all the
documents you need in hand when you take off with your big idea!