Post Incorporation Compliances for New Companies
POST INCORPORATION COMPLIANCES: What are they?
Great work on registering your company, taking the first steps towards to realizing your business dreams successfully. Read our Comprehensive Guides for registering a company: How to register your Company and Company Incorporation Procedure Now before you go start with business activities fully, there are still a few post incorporation compliances that a company needs to follow in order to avoid any hiccups in the smooth operations of the company. After all, you wouldn't want your newly incorporated company to be on the wrong side of the law now, would you? In addition to being in trouble legally, it is advisable to stay compliant with the regulations set by the Ministry of Corporate Affairs (MCA) because non-compliance imposes hefty fines on the company and new companies especially short on financial resources do not want this additional burden on themselves.
These compliances are especially critical and time-bound when your company will be involved with FDI (Foreign Direct Investments) Some of the most basic post incorporation compliances include setting up a bank account and acquiring the PAN of the company. Before, forming the bank account, however, banks have to informed of the remittance incoming from non-resident subscribers. Audit Requirements have to be evaluated along with having to apply GST, acquiring the Import-Export License these are just a few of the long list of post incorporation compliances. Let's look at them in detail.
POST INCORPORATION COMPLIANCES: A Comprehensive list
Maintaining a Registered Office
The Ministry is very strict about the maintenance of registered office premises and hence has made it mandatory to keep a registered office at all times. After the company registration is done, all organizations should file the registered office address form INC-22 within 30 days of incorporation. Contact us to change/register office address for your company.
Registered Office could be a corporate building, or it could be residential complex whether owned or rented doesn't matter as long as you have the approval documents (like NOC) / proof of address to prove that you are allowed to carry out business operations on those premises.
Board Meeting
The government has specified that all new companies who have just registered have to conduct a Board Meeting within the first 30 days of incorporation. Check out the details about Board Meeting. In the very first board meeting of the company, following decisions/matters have to be accounted for:- The approval to open a Current Account
- Appointing the very first Statutory Auditor
- Authorizing the Statutory Registrations
Letter Heads
Companies should get their letterheads printed as soon as possible as many documents of approval and other compliances require that documents contain the letterhead of the company. This letterhead should contain registered office name and address, CIN, Phone Number along with e-mail/ website address or both if required.
Board Outside the Office
All newly incorporated Companies should put out a Board/ display stating their name and their registered office, it helps people find the premises as well as helps keep you visible for new prospective clients/ business opportunities
GST/IEC Registration
As we mentioned before, GST registration and/or getting the IEC Code is pivotal as it is required for almost all business proceedings and transactions.
Bank Account
All newly incorporated companies have to get a current account opened with the bank of their choosing and once that has been done, the subscribers and/or the promoters of the company have to contribute the prescribed subscription money to the account.
Non-Resident Inward Remittances
If the subscribers of the company are non-residents of the country their contribution to the share subscription money will come via the process of Inward Remittance. The KYC(Know Your Customer) and the report for inward remittance have to be done in 30 days with the concerned authorized bank dealer of the RBI. Go to the FIRMS Portal to Report through Single Master Form [SMF]Issuing of Share Certificates
Section 10(2) of the Companies Act, 2013 indicates that all money payable by any member of the company under the Memorandum of Association or Articles of Association will be counted as a debt to the company from the particular member. The section 56(4) of the act also dictates that company should issue share certificates to the Memorandum Subscribers within 2 months of the date of the company registration.
Thus, it becomes pivotal that the share subscription money has been received before issuing share certificates through a proper banking channel.