It is now possible for one person company to be started by one person in the order of large companies and joint ventures. Just as there is only one boss for a normal box store, one person can start a small company and become an owner. It can get the benefits and protection provided by the government.
Recognition
Being a director of a company has more value and potential than being an owner. The identity of the company will enhance the borrowing value of the entrepreneur.
Capital
A company that starts with an investment of at least one lakh rupees can also be registered as a company. Raising investment from an individual company is easier than raising investment from an owner company. Decisions are made quickly because a person is a director who makes the decisions of the company.
Do not lose property
In the event of a loss in the business of the sole proprietorship, he will also have to forfeit his own property for the loans he has purchased for the business. But the entrepreneur does not have to lose his own assets for the losses incurred in the business if he registers as a company.
Audit
If registered as a company, the budget/profit and loss details of the business should be audited by the auditor within six months of the financial year. Companies are required to submit this audit report to the Registrar.
When operating as an individual owner, it is not mandatory to audit corporate accounts and budgets. It is enough to look at the budget according to the tax filing.
Board of Directors
The individual owner can run the business for his course. No need to hold a meeting. But companies are required to hold a board meeting every three months and record the meeting report. But there is no need to hold an annual general meeting.
Appointment of successor
After the owner his family heir or the persons he likes can continue to run the business. But if the company is registered, the nominee must be appointed. Only a nominee appointed by the director after him can continue the business.
Tax
An individual is required to pay 30 per cent tax on the company’s profits. No matter how much revenue the company earns, it is enough to pay 30 per cent tax. But if the owner is a company then the individual has to pay income tax based on the ceiling.
Entrepreneurs can take advantage of this law as it is safer to run a company than an owner and an opportunity to grow the business further. A person can register companies with the Companies Registrar. You can register at the office at Shastri Bhavan in Chennai.