If a Private Limited company takes any loan and is unable to pay off, the members are responsible to pay only that much how much they own towards their own shareholding i.e. A private limited company has limited liability and often these types of business have ‘Ltd’ … Pros and Cons of a Private Limited Company Pros There is a Limited risk to personal assets in Private Limited Company. Pvt. A private limited company can be a small or large business. Go For Private Limited Company If you have a small amount of capital you can form a private limited. In this post, we help you solidify your choice by listing the good and bad sides of incorporating a private limited company. The business owners hold all shares of the company privately. Limited Liability. A company is a legal entity separate from its owners. To find out more about the advantages and disadvantages of a Private Limited Company, please get in touch. In small companies, these could be the same people. So if it messes up, the owners won’t have to give away their personal money to pay out the business’s debts. In the Private Limited Company there would Limited Liability for members. A juristic person is a person who is not a natural person or a human being. Among the powers of a Private Limited Company are as follows: It is allowed under law to own real and personal properties The Private Limited Company can register its ownership over the properties it acquired by virtue of sale or any other modes of acquisition under its own name. Drawbacks include bookkeeping complexities and privacy issues. A private limited company has many advantages including limited liability, ease of raising capital, ease of setting up, separate legal identity, tax relief, and credibility when seeking new business or entering into transactions. What Are the Advantages of a Private Limited Company? Advantages of Section 8 Company. The private limited company is a proven, successful business model. Private Limited Company. Entrepreneurs have the chance to persuade other people to put their money in, in return for shares. 1) Uninterrupted Existence. Advantages of Private Limited Company: Here are some advantages to a Private Limited Company. If a private company contravenes any of the aforesaid provisions, it ceases to be a private company and loses all the exemptions and privileges to which it is entitled. Advantages of a private limited company Sure, limited liability is an obvious reason to set up a private limited company. I add the “completely legal” bit as when customers grasp this concept they are usually so stunned by how beneficial Limited Companies can be they have an instinctive feeling that it must somehow be “wrong”. Pvt Ltd Company Registration Benefits. the most they can lose is the amount they have invested in their shares. Zero Stamp Duty: A Section 8 company do not have to pay stamp duty on the AoA and MoA of the private or public limited company which other companies surely pays. The companies having minimum 2 and maximum 50 members and which are formed by at least two individuals having minimum paid-up capital are called the private limited company. Both registered and unregistered partnerships are legal, but the registered entity is preferred. Under the Indian Company Law, entrepreneurs have multiple options of business entities when commencing a business venture. Limited liability companies are structured similar to limited partnerships. A Private Limited Company is a privately held small business entity which limits the owner’s liability to their shares, it also restricts the number of shareholders to 50 and does not allow to trade the shares publically. A company is a legal entity and a juristic person established under the Act. Your company’s financial obligations are not your obligations. 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