Company Law for Startups (Part 1): Incorporation in India – Structure, SPICe+ and the First 180 Days
Private limited company incorporation for startups: structure choice, SPICe+ steps, documents, first board meeting, auditor and INC-20A within 180 days.
Two friends in a Kondapur co-working space have a working product and a first customer. Before the first invoice, one question: “Should we register a private limited company, an LLP or something else?” The answer shapes funding, tax and compliance for years.
1. Which structure fits you?
| Private Limited | LLP | One Person Company (OPC) | Sole proprietorship | |
|---|---|---|---|---|
| Best for | Startups seeking equity funding | Professional services, low-compliance ventures | Single founder wanting limited liability | Testing an idea |
| Equity funding / ESOPs | Yes | Not possible in the same way | Limited | No |
| Minimum people | 2 directors, 2 shareholders | 2 partners | 1 director/member plus nominee | 1 |
| Compliance load | Higher (ROC, audit, board meetings) | Moderate | Moderate | Lowest |
| Foreign investment | Possible under FEMA routes | Possible with conditions | Restricted | Not applicable |
Not sure between a company and an LLP? Read our Private Limited vs LLP comparison. Already an LLP and now raising funds? See converting an LLP into a private limited company.
2. The incorporation journey
ComplianceKart handles name approval, SPICe+, MOA and AOA, DIN, DSC and the post-incorporation checklist. See our private limited company incorporation page.
3. After the certificate: your first 180 days
| Task | Deadline | Law |
|---|---|---|
| Registered office verification (Form INC-22) | Within 30 days of incorporation | Section 12 |
| First board meeting | Within 30 days of incorporation | Section 173(1) |
| First auditor appointment by the Board | Within 30 days of incorporation | Section 139(6) |
| Subscribers pay for shares and file declaration of commencement (INC-20A) | Within 180 days of incorporation | Section 10A |
| Issue share certificates | Within 2 months of incorporation (confirm) | Section 56 |
| Open the company bank account and receive subscription money | Before INC-20A | Practice requirement |
4. Six mistakes founders make
- Naming the company without a trademark check, and rebranding later.
- Splitting equity informally and writing nothing. Use a shareholders agreement.
- Missing the 30-day first board meeting and auditor appointment.
- Not filing INC-20A and discovering it only when the bank or investor asks.
- Using a residential address without owner’s NOC.
- Starting with the wrong capital split, which can complicate future funding.
Why work with ComplianceKart
ComplianceKart is a boutique practice bringing Chartered Accountants, Company Secretaries and advocates under one roof. Think of a multi-speciality hospital: the physician, the radiologist and the pharmacist read from one patient file, so you never carry reports between buildings. A startup incorporation touches company law, tax registrations, bank documents and contracts at once. When one team sets them up together, nothing is missed in the first 180 days.
Frequently Asked Questions
What is the minimum number of directors for a private limited company?
Two directors and two shareholders, with at least one director who is resident in India (stayed 182 days or more in the previous financial year).
What is SPICe+?
An integrated online form on the MCA portal for incorporation, name reservation, DIN, PAN, TAN and certain registrations.
What is INC-20A?
A declaration of commencement of business, to be filed within 180 days of incorporation after subscribers have paid for their shares.
Can foreigners be directors or shareholders?
Yes, subject to the residency requirement for one director and FEMA rules on foreign investment. See our FEMA series.
How long does incorporation take?
Typically a couple of weeks, depending on name approval and document quality (not guaranteed).
Sources
- Companies Act, 2013: Sections 3, 10A, 12, 139(6), 149(3), 173(1)
- MCA reply to Rajya Sabha Unstarred Question 229, 21 July 2026 (zero fee up to Rs 15 lakh authorised capital)
Ready to act? Start with our private limited company incorporation page, check pricing, or contact us.
WhatsApp usEmail team@compliancekart.comCall 9959536391
Educational article, last updated 11 November 2026. General information, not advice on a specific case. Laws and due dates change; confirm on the date you act. Items marked (confirm) came from secondary sources and need checking against the official text.
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