What Is A Private Limited Company?
What is a Private Limited Company? A Private Limited Company This is a type of business entity which is registered under the Companies Act, 2013 and governed by the Ministry of Corporate Affairs (MCA).
In India, it is amongst the most sought-after business formations since:
- It has a separate legal identity
- Owners have limited liability protection
- It is suitable for startups and growing businesses
- It builds trust with investors, banks, and clients
Basic Eligibility Criteria (2026)
| Requirement | Details |
|---|---|
| Minimum Directors | Minimum 2 directors |
| Shareholders | Shareholders/directors 2 in minimum (Directors may be also shareholders) |
| Resident Director | At least one of the directors must be a resident in India. |
| Registered Office | A registered office address in India |
| Capital | No minimum capital requirement (as per current rules) |
Step-by-Step Private Limited Company Registration Process (2026)
Step 1: Obtain Digital Signature Certificate (DSC)
This is because the process of registration is entirely online and therefore all the suggested directors must possess a Digital Signature Certificate. Electronic documents uploaded on the MCA portal are signed with the help of the DSC.
Documents required for DSC:
- PAN card
- Aadhar card or Passport
- Passport-size photo
- Mobile number and email ID
Time required: 1 to 3 working days.
Step 2: Apply For Director Identification Number (DIN)
Every director should have Director Identification Number (DIN). DIN may be introduced to the SPICe+ incorporation form directly in 2026. You are not required to separately apply when you are applying during registration of the company.
Step 3: Name Reservation Through SPICe+ Part A
You need to choose a distinctive name of your company.
Rules for choosing a company name:
- It must be unique
- It should not match any existing company or trademark
- It must end with “Private Limited”
- It should reflect the main business activity
Approval of name is effected via MCA portal by use of SPICe+ Part A form. Approval time: It normally takes 2-4 working days.
Step 4: Prepare MOA And AOA
You need to prepare two important documents:
- Memorandum of Association (MOA) : This states the primary goals and operations of the company.
- Articles of Association (AOA) : This is internal regulations, management composition, and running of the company.
These are submitted in 2026 electronically (e-MOA and e-AOA) together with the incorporation form.
Step 5: File SPICe+ Form (Main Incorporation Form)
The combined web based company registration form is referred to as SPICe+.
Through this single form, you can apply for:
- Company incorporation
- DIN
- PAN
- TAN
- EPFO registration
- ESIC registration
- Professional Tax registration (in applicable states)
- Bank account opening (optional integration)
Documents required:
- Identity and address proof of directors
- Registered office proof (rent agreement or ownership proof)
- NOC from property owner (if rented)
- Utility bill (not older than 2 months)
This is at the stage where government fees and stamp duty are to be paid. The charges are based on approved capital and state.
Step 6: Certificate Of Incorporation (COI)
The Certificate of Incorporation is issued after it is verified by the Registrar of Companies (ROC).
The certificate includes:
- Corporate Identity Number (CIN)
- Company name
- Date of incorporation
- PAN and TAN
After you are given the Certificate of Incorporation, then your company is legally established. Full registration time: Typically it takes between 7 to 14 working days in case the documentation is in order.
Estimated Cost Of Private Limited Company Registration In 2026
The cost depends on state and authorized capital, but generally includes:
| Component | Approximate Cost (INR) |
|---|---|
| DSC cost per director | approximately 500 to 2,000 INR |
| Government registration fees | depends on capital structure |
| Stamp duty | varies by state |
| Professional fees (CA/CS) | approximately 5,000 to 20,000 INR |
| Total estimated cost | 10,000 to 30,000 INR for most small startups. |
Post-Registration Compliance In 2026
Post Incorporation: Annual compliance for Private Limited Company including the following steps:
- Maintain proper books of accounts
- Hold at least 4 board meetings each year
- Appoint an auditor within 30 days of incorporation
- File annual return (MGT-7)
- File financial statements (AOC-4)
- File Income Tax Return (ITR-6)
- Mandatory statutory audit every year
Non-compliance may lead to penalties and additional fees.
Advantages Of A Private Limited Company
- Limited liability protection
- Better funding opportunities
- Higher business credibility
- Easy transfer of ownership through shares
- Perpetual succession (company continues even if directors change)
Common Mistakes To Avoid
- Choosing a name that already exists
- Incorrect or mismatched documents
- Wrong registered office documents
- Ignoring annual compliance after registration
References:
- https://instabizfilings.com/private-limited-company
- https://instabizfilings.com/blog/ministry-of-corporate-affairs-mca
- https://instabizfilings.com/blog/digital-signature-certificate-online
- https://instabizfilings.com/blog/mca-portal-registration
- https://instabizfilings.com/blog/pan-card
- https://instabizfilings.com/blog/aadhar-card
- https://instabizfilings.com/blog/passport
- https://instabizfilings.com/director-identification-number-din
- https://instabizfilings.com/blog/company-incorporation
- https://instabizfilings.com/blog/understanding-epfo-epfo-member-portal-log-in-passbook-and-more
- https://instabizfilings.com/blog/esic-employees-state-insurance-corporation
- https://instabizfilings.com/blog/professional-tax-registration
- https://instabizfilings.com/blog/bihar-rent-agreement-format
- https://instabizfilings.com/blog/certificate-of-incorporation
- https://instabizfilings.com/blog/annual-compliance-for-private-limited-company
- https://instabizfilings.com/blog/mgt-7-form
- https://instabizfilings.com/blog/form-aoc-4
- https://instabizfilings.com/blog/itr-6-return-filing
