Employees Provident Fund (EPF) could be a scheme that’s regulated by the workers’ Provident Fund Organisation (EPFO) and it had been introduced thanks to the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952. The work culture today depends on the welfare of workers, with employers scrambling to ensure their workers are entitled to the most effective care and benefits.
Limited Liability Protection
One of the largest advantage of a registered business (private limited company or limited liability partnership (LLP) or one person company) is that it affords limited liability protection to its members. Hence, the promoters of the business wouldn’t be in person liable for liabilities of the business. Doing business always involves the chance of running into losses and having limited liability protection would make sure that the entrepreneur will take risks while not the worry of losing everything.
Transferability or sharing of possession of a business could be a major hurdle in unregistered business entities. Proprietorships can’t be transferred as they’re an extension of the owner Associate in Nursingd it’s also exhausting to define the assets belonging to an unregistered partnership firm. On the opposite hand, in registered business entity like company or LLP, the business is taken into account a separate legal entity with assets and liabilities that area unit distinct of its promoters. Hence, transferring or sharing the ownership of a registered business is simple.
Opening bank account
The method for gap a checking account for a proprietorship or partnership firm could be a cumbersome process, because the business entity has no legal proof of existence. Hence, within the case of a proprietorship firm or unregistered partnership firm, the existence of a business should be established through varied tax registrations within the name of the firm to open a bank account. On the opposite hand, for an organization or LLP, the existence of the business is established by the Ministry of company Affairs by manner of a certificate of incorporation and memorandum of association. Hence, checking account will be opened simply by submitting a duplicate of the certificate of incorporation and memoranda of association.
Funding within the sort of debt or equity is an important requirement for any business. Equity funding can’t be syndicated for unregistered business entities like ownership firm or partnership firm. Also, beginning a ownership firm or partnership firm for a business that has plans for syndicating equity funding would be a mistake. As most banks and financial institutions opt to lend to registered business entities. Hence, it’s extremely counseled to register a business if there area unit plans for raising debt or equity funds within the name of the business.
Most giant businesses that have a provider choice criteria, tend to opt to do business with a registered business entity than an unregistered business entity. Hence, registering a business will build the business eligible to fulfill client criteria, participate in tenders and meet varied needs set by patrons or customers.