The Indian Companies Act of 2013 regulates the process for registration of companies in India. The costs of registering an organisation differ based on criteria including the number stakeholder groups and the magnitude of the organisation. Entrepreneurs can pick from a selection of business structures when forming their business, depending on its purpose and special needs.
Therefore, the registration fees will differ depending on the chosen firm structure and the state where it is registered. The cost of registering a company can vary based on several factors such as the number of directors, members, authorised share capital and professional fees.
Factors Influencing Company Registration Fees in India
The given factors influence the cost of company registration in India, as mentioned below:
- Type of Company: The registration cost is dependent on the type of company that you opt for – whether it’s a private limited company or a public limited company or even a one-person company. Each of these company types has its own set of basic requirements and necessary compliance obligations, which leads to differences in the registration cost. To give a simple example, a one-person company may incur a lower registration cost compared to a private limited company due to fewer statutory demands.
- Stage of Company Incorporation: The stage of incorporation at which your company is can also affect the overall registration cost. Pre-registration costs include name reservation, drafting the Memorandum of Association and Articles of Association and obtaining DIN and DSC of promoters. Post-registration costs may involve obtaining PAN, TAN and various other tax and labour law registrations. Each stage incurs its own set of expenses.
- State of Incorporation: The state in which you choose to incorporate your company can influence the registration cost. Different states in India have their own fee structures, stamp duty charges and compliance costs. It is essential to consider state-specific regulations and associated costs while estimating the overall registration expenses.
- Professional Fees: Engaging legal and professional services from experts like at StartupFino is significant for a smooth registration process. The professional fees charged by experts may vary based on their expertise, experience and the complexity of the registration process. Researching and comparing fees from different professionals can ensure quality services at a reasonable cost.
- Additional Expenses: Apart from primary costs, there may be additional expenses during the registration process. These expenses can include charges for name reservation, digital signature certificates, notary fees, government fees and other incidental expenses. For example, obtaining a digital signature certificate (DSC) is often required for online filing and its cost should be considered while budgeting for the registration process. It is significant to review the complete list of potential additional expenses and factor them into your budget.
Fees for Registration of Company
The Ministry of Corporate Affairs has taken significant steps to update the process of starting a business in India. Now, entrepreneurs can avail five essential procedures for starting a business simultaneously in a single step using the integrated e-Form SPICe (Simplified Proforma for Incorporating Company electronically).
This integrated approach allows individuals planning to establish a Company to apply for Company Name, Company Incorporation, DIN of directors, PAN and TAN for the newly incorporated company all at once. These reforms have been instrumental in reducing the bureaucratic complexities and providing greater ease of doing business in the country.
Flexible Cost Range
Considering the aforementioned parameters, the registration fee for a Company can range from Rs. 6,000 to Rs. 30,000. Entrepreneurs should therefore plan their budgets very carefully and pick the services that best suit their business needs.
Fees of Other Important Government Registrations for Company
In India, various types of business forms and services exist, each of which requires specific government registrations. Whether it’s GST registration, VAT registration, IEC registration for Import-Export businesses, Professional Tax registration for certain professions, EPF registration or MSME registration for small and medium companies, these registrations are essential for compliance and legal operations and StartupFino can aid entrepreneurs in all of these to ensure hassle-free compliance.
The costs of these registrations, which include professional fees and government fees, differ depending on the type of registration and the complex nature of the tasks required. The registration fee could vary between Rs. 1500 and Rs. 15000, based on factors including state taxes and other applicable expenditures.
Aspiring entrepreneurs ought to maintain these expenditures in mind as they plan their business budgets and guarantee compliance with the essential regulatory standards.
Mandatory Compliances for Company Registration and Related Fees
The mandatory compliances that a company must adhere to are:
1. First Board Meeting
After company registration, the first board meeting is a significant step where the directors gather to discuss and strategise the company’s initial actions. During this meeting, important decisions are made, such as appointing key officers, approving the company’s bank account and adopting the company’s Articles of Association and Memorandum of Association.
2. Subsequent Board Meetings
Following the first board meeting, regular board meetings must be held to review the company’s progress, address operational matters and make strategic decisions. These meetings are essential for the effective management and direction of the company.
3. Filing of Disclosure of Interest by Directors
Directors of the company have to compulsorily disclose any interests they have in other companies or entities so as to avoid any conflicts of interest and maintain transparency moving ahead.
4. First Auditor and Subsequent Auditor
The company must appoint its first auditor within 30 days of incorporation. Subsequently, auditors are appointed at each Annual General Meeting and serve to examine and verify the company’s financial records.
5. Annual General Meeting (AGM)
Every firm is required to convene an AGM within a duration of 6 months of the end of its fiscal year. Financial statements, audit reports and other significant issues are presented to investors for consideration at the Meeting.
6. Filing of Annual Return (Form MGT-7)
Within 60 days of the AGM, the firm must file its Annual Return in Form MGT-7 to the Registrar of Companies. The Annual Return contains important information about the company, including its financial performance and shareholders’ structure.
7. Filing of Financial Statements (Form AOC-4)
The company must file its Financial Statements in Form AOC-4 with the ROC. These statements include the company’s balance sheet, profit and loss account and cash flow statement, providing an overview of its financial position.
8. Statutory Audit of Accounts
A statutory audit of a company’s accounts is necessary in order to verify conformity with accounting norms and the law. The audited accounting records give the company’s accounting records authenticity.
Fees for Mandatory Compliances
The cost of meeting these statutory compliances may vary according to the company’s size and stature. Fees for these compliances can vary from Rs. 2,000 to 20,000. Proper compliance not only ensures legal adherence but also enhances the company’s reputation and credibility in the market.
Additional Fees for Delay in Filing Forms
From 1st July 2022, the Ministry of Corporate Affairs (MCA) has introduced a table of additional costs applicable for delays in filing certain forms, including cases where the Nominal Share Capital is increased. It is significant for companies to be aware of these additional fees to ensure timely compliance with the filing requirements.
The table below outlines the periods of delay and the corresponding fees charged for late filings:
| Period of Delay | Fees Charged for Delay in Filing Forms | Higher Additional Fees for Delay in Filings |
| Up to 15 days delay | One time of normal filing fees | – |
| More than 15 days but less than or equal to 30 days | 2 times of normal filing fees | 3 times of normal filing fees |
| More than 30 days but less than or equal to 60 days | 4 times of normal filing fees | 6 times of normal filing fees |
| More than 60 days and up to 90 days | 6 times of normal filing fees | 9 times of normal filing fees |
| More than 90 days but less than or equal to 180 days | 10 times of normal filing fees | 15 times of normal filing fees |
| More than 180 days | 12 times of normal filing fees | 18 times of normal filing fees |
Please note:
- If there is a delay in filing e-form INC-22 or e-form PAS-3, one or more times within a period of 365 days from the date of filing the last such belated e-form, higher additional fees may be payable.
- Where a higher additional fee is due, there will be no further fees imposed.
- E-Form INC-22 or e-form PAS-3 filed before the effective date of the Corporations (Registration Offices and Fees) Amendment Regulations 2022 will not be considered when calculating higher additional fees.
Note: For details on the government fees applicable for company registration, visit the official website of MCA at https://www.mca.gov.in/Ministry/pdf/tableoffee_01042014.pdf
Final Thoughts
Company registration in India entails various costs and fees, subject to factors like the type of company, state of incorporation and professional services engaged. The Ministry of Corporate Affairs has simplified the process through the integrated e-Form SPICe, enhancing ease of doing business. Post-registration, companies must comply with mandatory requirements such as board meetings, auditor appointments, AGMs and filing financial statements.
Timely compliance ensures legal adherence and enhances credibility. Additionally, companies should be attentive about additional fees for delays in filing forms, effective from July 2022. Comprehensive planning and budgeting enable entrepreneurs to establish and operate their businesses efficiently and compliantly in India.
