Free guide · Updated 2026
How to incorporate a startup in India
If you are a first-time founder in India, the legal wrapper is not the company — but getting it wrong will stall a bank account, a GST invoice, or a term sheet. This is the sequence most product and services startups actually follow.
1. Pick the entity before you pick the logo
Private Limited is the default if you will raise capital, issue ESOPs, or hire at any scale. Indian VCs almost never close into an LLP. An OPC works for a solo founder who wants limited liability now and can convert later. An LLP fits professional firms that will not sell shares. A sole proprietorship is fine while you are testing a service with your own money.
Read the full comparison: Pvt Ltd vs LLP vs OPC andwhy VCs insist on a Pvt Ltd. You can convert later, but it is slower than starting with the right form.
2. How a Private Limited actually gets registered
- DSC and DIN. Every proposed director needs a digital signature. DIN is allotted during SPICe+ if they do not already have one.
- Name reservation (SPICe+ Part A). Avoid names too close to a trademark or an existing company. Keep two backups.
- Incorporation (SPICe+ Part B). MOA, AOA, registered-office proof, and KYC. PAN, TAN, EPFO, ESIC, and sometimes GST can ride along.
- Certificate of Incorporation. You now have a CIN. Open a current account, deposit share capital, issue certificates.
Step-by-step with forms: How to reserve a name and incorporate.
3. After you have a CIN — do not stop
First board meeting, first auditor, statutory registers, and a calendar for AOC-4 / MGT-7.First-year Pvt Ltd compliance is the list investors will ask about in diligence.
Register GST when you hit the threshold, sell inter-state, or a customer refuses to pay without a GSTIN. Apply for DPIIT recognition if you want Startup India schemes or a cleaner conversation with banks.Udyam is free and often requested for MSME-linked credit.
NRIs and foreign co-founders: you still need one resident director, and share allotment is FDI paperwork. See Can an NRI be a founder?
4. What founders actually budget
Government fees are usually modest. Professional fees plus first-year audit and bookkeeping are the real number.Typical incorporation cost for a simple two-director company.
5. Every incorporation question on this site
- Why do Indian VCs prefer a Private Limited company over an LLP?
- What is DPIIT Startup Recognition and why does it matter?
- When is GST registration mandatory for a startup in India?
- How are ESOPs taxed for employees of Indian startups?
- Can a foreign investor put money into an Indian LLP?
- What is the Startup India Seed Fund Scheme (SISFS)?
- Is a statutory audit mandatory for a One Person Company?
- Does a sole proprietorship have a separate legal identity?
- Does angel tax still apply when I raise a seed round?
- Pvt Limited vs LLP vs OPC — which entity should I start with?
- How do I reserve a name and incorporate a Private Limited company?
- What compliances does a new Private Limited have in the first year?
- Can I convert an LLP or OPC into a Private Limited later?
- What is Udyam (MSME) registration and should my startup get it?
- How much does it cost to register a Private Limited company in India?
- Can an NRI or foreigner be a founder or director of an Indian startup?
This guide is for education. MCA fees, GST thresholds, and FEMA rules change. Confirm the current position with a CA or company secretary before you file.