How to start business - step wise

The first step towards starting your Import/Export business is to decide and register your business entity. Generally there are 5 popular business structures to get yourself registered-

Sole Proprietorship

One Person Company

Partnership Firm

Limited Liability Partnership

Private Limited Company.

Basically, you can go for Solo Proprietorship firm since you are sole owner of the Firm which control on the business. As a Import Export Business you have to require only the tax registration as a firm like CST and IEC Code, i.e. Import Export Code( a unique code generated by the Directorate General Of Foreign Trade( DGFT) to track imports and exports of goods from India) so its can be done in less cost of formation. Even you have to pay just only the Income tax on the Slab basis ad Individually so you can easily save the income tax.

However it is recommended to get your business registered as private limited company in case of export business since it offers the promoters of the business limited liability protection, transfer-ability, easy access to bank loans and many more such benefits. Further, foreign clients prefer dealing with a registered corporate entity in India.

After registering your business, tax registration can be obtained in the name of the business entity. PAN is the first tax registration required for any kind of new business in India. After that you need to open up a bank account- to commence businesses.

Though, goods and services exported from India do not attract VAT or services tax but VAT registration might be required for the business as it might be required in the business to buy goods from the other state and service tax registration might also be required for the billing of domestic clients. So, it is advisable to have your VAT registration done.

Moreover, VAT and CST or Sales Tax or TIN Registration is required for selling the goods in India for the retailers and manufacture. So you need to apply for the VAT Registration from your state government. VAT is a Indirect taxes so its rules and regulations is very state to state. Even in some state there is security concept so its little bit expensive.

Then, you need to appoint an expert customs clearing agent. He will be able to assist you in clearing the batch at the port. Calculating numerous expenses in port is also important, which is the responsibility of an agent. These expenses include handling charge, customs duty, transportation charges and much more.

The next step involves using your own freight forwarder. A freight forwarder or forwarding agent is also known as a NVOCC (non-vessel operating common carrier), is a person or company that manage and organizes point to point shipments for individuals or corporations to import goods from the manufacturer abroad to your location.

Some Tips which is require for Import Export Business in India :-

• Business Current Account have a SWIFT Code.
• Find Reputed Supplier from Alibaba or other Website.
• Raise Purchase Order ( PO) on your Company Name.
• Purchase Order and Invoice amount must be same.
• Hire third parties for the shipping.

What is Conveyance Allowance?

CA, also called Transport Allowance is a type of allowance offered to employees of a company to compensate for their travel from residence to and from respective workplace location. Allowances are generally offered to employees on top of their basic salary component and may or may not be taxable as per the Income Tax Act.

conveyance allowance is paid by an employer only if the there is no transportation provided by the employer. In case an employer offers office transport, conveyance allowance will not be provided to employees.

Conveyance Allowance Limit for FY 2016-17 & AY 2017-18

There is no limit on the amount of conveyance allowance a company can offer to its employees. However, there is a limit on the amount of exemption under the Income TaxAct as detailed below.

Is Conveyance Allowance Taxable?

Conveyance allowance is given an exemption of up to Rs.19,200 per annum or Rs.1,600 per month. The sections under which this exemption is applicable are Section 10(14)(ii) of Income Tax Act and Rule 2BB of Income Tax Rules.

Before April 2015, the conveyance allowance taxation exemption limit was capped at Rs.800 per month or Rs.9,600 per annum. The exemption limits were extended to Rs.1,600 per months or Rs.19,200 per year in Budget 2015 with an eye to provide tax benefits to the middle class taxpayers in the country.

You do not need to furnish any documents or proof of receiving conveyance allowance from your employer. The full amount of Rs.1,600 per month can be claimed as tax exemption under travel or conveyance allowance.

How to Calculate Conveyance Allowance?

A point to note here is that the exemption for conveyance allowance can be grouped with some other allowances, for instance Special Allowance. So, if your employer is offering you a Special Allowance of Rs.5,000 per month which is fully taxable, you can substitute Rs.1,600 as conveyance allowance and claim tax exemptions for the same. However, you should only do this after consultations with your personal tax advisor.There are no complicated calculations involved in calculating conveyance allowance limit. The limits are absolute at Rs.1,600 per month or Rs.19,200 per year irrespective of the tax bracket an individual falls into.

What is the Conveyance Allowance for Handicapped People?

Handicapped people used to receive a higher limit of Rs.1,600 per month or Rs.19,200 per year as conveyance allowance before April 2015 as compared to other categories of taxpayers. However, Budget 2015 made the exemption limit uniform across all categories of taxpayers at Rs.1,600 per month.

Section 80c - Deductions under Section 80c

most people start sweating and running around looking for ways in which they can save on it. One of the most commonly known sections of the Income Tax act is section 80C. 

Tax Exemption under 80c for FY 2015-16:

As opposed to the deductions for the financial year 2013-14, the limit for maximum deduction under section 80c for 2014-15 and 2015-16 have been changed to Rs. 1.5 lakhs. This means that investments made under 80C up to Rs. 1.5 lakhs will be eligible for tax exemptions. These exemptions are not just limited to investments but also include payments that may be made towards expenses like education fee and home loans.

Eligible Deductions under Section 80c:

So what are the deductions that are eligible for exemption under section 80C? The following is a list of dedications that are included under section 80C.

• Home Loan Payments:
  When you pay a home loan EMI, there are two major components to it; the principal and the interest. Under section 80C you can claim tax benefits on the principal paid. You can also claim benefits under section 24.
• Stamp Duty and Registration Charges for House:
  When you buy a house, one of the expenses you incur will be payments for the stamp duty and the registration of the property. Whatever is spent on these expenses is eligible for benefits under section 80C
• Life Insurance:
  All life insurance premium payments, include those paid for unit linked insurance plans, are also eligible for tax benefits under section 80C. Even if your policy covers other family members, you can claim the tax benefits for the premiums paid. The limit for claiming these benefits is Rs. 1.5 lakhs. This means that if you make no other investments but pay Rs. 2 lakh towards a life insurance policy then Rs. 1.5 lakh out of it will be eligible for tax benefits. This benefit will also only apply if the premium is paid by you, not if your wife or husband or parents pay the premium.
• Health Insurance:
  When you take a health insurance policy, be it an individual or a family floater policy, the annual premium you pay for the policy is eligible for tax benefits under this section.
• Fixed Deposits:
  Most banks offer tax saving fixed deposits that provide tax benefits on the amount deposited in them. These deposits come with a mandatory lock in period of 5 years and can have a maturity period ranging from 5 years to 10 years. The limit of investment in these deposits is determined by the bank and can range from Rs. 1 lakh to Rs. 1.5 lakhs in a year. It needs to be noted that not all FD investments are eligible. Only the ones made in tax saving FDs are.
• Mutual Fund Investments (ELSS):
  When you invest in a mutual fund, particularly an equity linked savings scheme or a tax saving mutual fund, the amount invested is eligible for tax exemption under this section. These mutual funds come with a lock in period of 3 years.
• Provident Funds:
  There are different provident funds that you can invest in. One is the PPF (Public Provident Fund) with an annual investment limit of Rs. 1.5 lakhs and a maturity period of 15 years. The others are EPF and VPF; EPF are Employee Provident Funds where the employer and the employee contributes towards the PF and VPFs are Voluntary provident funds where the employee can choose to contribute more than the employer towards the PF. Regardless of the type of fund, all contributions made are eligible for tax benefits.
• National Savings Certificates:
  National savings certificates are an investment that come with maturity period of 5 and 10 years. Investments made in these certificates is also eligible for tax benefits up to Rs. 1.5 lakhs.
• Sukanya Samriddhi Account:
  This is a special account that was announced by the government in early 2015. It allows parents to open an account for a girl child and deposit money in it, up to Rs. 1.5 lakhs per annum, and earn an interest of 9.1% per annum on it. This account can be opened for two children and can be extended to a third in case there are twins involved.
• Infrastructure Bonds:
  These are bonds that are issued by infrastructure companies like Infrastructure Development Finance Company and India Infrastructure Finance Company. They offer an interest on the money invested with them and the investments made in the tax saving infrastructure bonds are eligible for tax benefits.
• Post Office Time Deposit:
  Just like fixed deposits, time deposits held at post office also are eligible for tax benefits under this section. These deposits come with an option of a 5 year time deposit where investments become eligible for benefits. These deposits also offer attractive interest rates in excess of 8% per annum however it can change at any time.
• Education Expenses:
  School fee is not cheap these days and for that reason, when you do pay it you can claim tax benefits on the amount that you have paid. The conditions that apply in this investment are that it is available only for two children, the school cannot be outside India and the tuition fee is the only payment that is eligible.
• Pension Funds:
  Almost everyone has some sort of a plan in place for the day they retire. If your plan includes investments in a pension fund then the investments made are eligible for deductions under section 80C.
• Senior Citizen Saving Scheme:
  This is a scheme that can only be invested in by senior citizens and provides quarterly interest payments instead of compounded interest. Under this scheme when an investment is made into the scheme, it becomes eligible for tax benefits under this section.

NRI claim under Section 80C:

In India, the basis of the income sources of a person determines the date of filing IT returns for him/her. The due date for filing income tax stays the same irrespective of an individual's residential address. The personal income tax must be filed on or before September 30 of a year. For example, for filing income tax returns for FY 2014 – 2015, which starts from April 1, 2014 and ends on March 31, 2015, the last date is September 30, 2015.

Income tax must be filed for the following income sources:

• Income from profession or business where the a/c of these professions and businesses must be audited in India.
• If the tax filer is a working partner in a particular partnership firm where the account must be audited in India.

All NRIs can avail equal tax deductions as the Indian residents under this section. For example, NRIs can claim deductions on life insurance premiums, pension schemes, etc.

Frequently Asked Questions:

1. Does the limit of Rs. 1.5 lakhs mean that I can invest Rs. 1.5 lakhs in more than one instrument and claim benefits?
   No. The limit of Rs. 1.5 lakh means that after taking into account all the investments you have made under 80C, the maximum benefit of Rs. 1.5 lakhs can be claimed.
2. What is the definition of a senior citizen for the senior citizen savings scheme?
   A senior citizen under this scheme is either someone who is more than 60 years of age or someone who is more than 55 years or age but less than 60 years but has taken voluntary retirement under a specific retirement scheme.
3. When it comes to provident funds, will investments in EPF and PPF be eligible if investments are made in both?
   If you are contributing towards an EPF and are investing in a PPF at the same time, you can claim both investments under 80C.
4. Under EPF schemes is the entire contribution eligible for deduction under 80C?
   No. In EPF only the half paid by the employee is eligible for benefits.
5. If I want to get into tax savings, which options should I go in for?
   The options would be dictated by a multitude of factors like your age, risk appetite and the amount that you wish to invest but some basic ones that you should consider investing in are life and health insurance policies, mutual funds, fixed deposits and provident funds.
6. Is the interest earned through these instruments also eligible for tax deductions under 80C?
   No. The interest earned in most cases is liable for tax under other sections except in the case of NSCs where if the interest is reinvested, it becomes eligible for deduction under 80c for the year that it is reinvested in.
7. If I take a loan for repair/renovation of a house, can I claim deductions under 80C?
   A regular home loan is eligible under 80C but one take from repairs and renovation is not.

कैसे जानें PF बैलेंस..Missed Call se

अगर आप अपना पीएफ बैलेंस जानने के लिए परेशान हैं तो आपको परेशान होने और ईपीएफओ आॅफिस के चक्कर काटने की जरूरत नहीं है। ईपीएफओ आपको अपना पीएफ बैलेंस आॅनलाइन और मैसेज के जरिए जानने की सुविधा दे रहा है। इसके जरिए आप केवल कुछ ही देर में अपना पीएफ बैलेंस पता कर सकते हैं। EPFO आपको पीएफ बैलेंस जानने की सुविधा दे रहा है-
मिस्‍ड कॉल देकर - आप केवल एक मिस्‍ड कॉल देकर भी PF बैलेंस जान सकते हैं। - इसके लिए आपको 011-22901406 पर मिस्‍ड कॉल करनी होगी। - इसके बाद आपको मैसेज के जरिए PF बैलेंस की जानकारी मिल जाएगी।

आपके पीएफ अकाउंट पर नहीं मिलेगी 7500 से ज्‍यादा पेंशन, चाहे जितनी भी हो सैलरी.

अगर आप संगठित क्षेत्र में नौकरी कर रहे हैं और कर्मचारी भविष्‍य निधि संगठन (ईपीएफओ)  के सदस्‍य हैं तो मौजूदा नियमों के तहत आपको अधिकतम 7500 रुपए ही पेंशन मिल पाएगी। ऐसा इसलिए है क्‍योंकि मौजूदा समय में इम्‍पलाइ प्रॉविडेंट फंड स्‍कीम के तहत अधिकतम वेज लिमिट 15000 रुपए है। 

अगर यह लिमिट फ्यूचर में नहीं बढती है तो... आप की अधिकतम पेंशन 7500 रुपए ही होगी। .
यह है पेंशन तय करने का फार्मूला    कर्मचारी भविष्‍य निधि संगठन के एक वरिष्‍ठ अधिकारी ने बताया कि अगर कोई मेंबर रिटायर होता है तो उसकी पेंशन पेंशनेबल सैलरी के आधार पर तय की जाती है। इसके लिए पिछले पांच साल की सैलरी का औसत निकाला जाता है। इस तरह से पेंशनेबल सैलरी तय होती है। पेंशन तय करने का फार्मूला है। यह फार्मूला 1995 के बाद नौकरी ज्‍वाइन करने वालों के लिए है।    पेंशन अमाउंट = पेंशनेबल सैलरी × सेवा की अवधि/ 70... 
मान लेते हैं किसी पीएफ मेंबर की पेंशनेबल सैलरी 15000 है और उसने 30 साल नौकरी की है। मौजूदा नियमों के हिसाब से उसे 2 साल का बोनस मिलेगा। इसतरह से उसकी सेवा की अवधि 32 साल हो जाएगी तो उसकी पेंशन मौजूदा फार्मूले के तहत 6858 रुपए होगी।    पेंशन अमाउंट = 15000 × 32 साल/ 70  मंथली पेंशन होगी 6,858 

35 साल की नौकरी तो मंथली पेंशन 7500    
अगर 2 साल का बोनस जोड़ कर किसी मेंबर की नौकरी की अवधि 35 साल होती है तो उसे मौजूदा वेज लिमिट के आधार पर 7500 रुपए पेंशन मिलेगी। अगर भविष्‍य में सरकार वेज लिमिट को 15000 रुपए से बढ़ा कर 20,000 रुपए या 25,000 रुपए कर देती है तो इम्‍पलाइज पेंशन स्‍क्‍ीम के तहत 58 साल की उम्र में रिटायरमेंट पर पेंशन लिलती है या 50 साल की उम्र पूर भी अर्ली पेंशन मिलती है। 
सरकार करती है पेंशन फंड में योगदान    इम्‍पलाइ पेंशन फंड में कंपनी के मंथली कंट्रीब्‍यूशन का 8.33 फीसदी हिस्‍सा जाता है। इसके अलावा सरकार भी फंड में कर्मचारी की सैलरी का 1.16 फीसदी योगदान करती है। मौजूदा समय में इम्‍पलाइज पेंशन स्‍क्‍ीम के तहत न्‍यूनतम पेंशन 1,000 रुपए है। यानी अगर किसी की पेंशन 1,000 रुपए से कम बनती है तब भी सरकार उसे हर माह 1,000 रुपए पेंशन सुनिश्चित करेगी। ... 

जीवन भर मिलती है पेंशन 

 इम्‍पलाइज पेंशन स्‍कीम के तहत मेंबर को रिटायमेंट के बाद जीवन भर पेंशन मिलती है। कर्मचारी की मौत के बाद उसकी पत्‍नी को पेंशन मिलती है।... 
पत्‍नी की मौत के बाद दो बच्‍चों को 25 साल की उम्र तक पेंशन का प्रावधान है। ... 

All about non copy right video

Process to Get ESIC Pehchan Card Or ESI Card

To Get ESIC Pehchan Card : ESIC card is also known as Pehchan card or PIC. Employee state insurance is a social welfare scheme to help the employees whose gross salary is below 21000 Rs. There are number of ESIC dispensaries and hospitals are helping the employees by giving medical treatment to them & also to their family members.

Earlier ESIC scheme was applicable to employees whose salary is less than 15000 Rs but in order to cover more number of employees the ceiling limit increased to 21000 Rs.

ESIC Percentages : 1.75% of employee’s gross salary will be contributed every month towards ESIC and 4.75% of employee gross salary will be contributed by employer towards  ESIC.

Benefits Of ESIC:

Employees who are covering under ESIC scheme will get the following benefits.

1. Medical Benefit
2. Sickness Benefit
3. Maternity Benefit
4. Disablement Benefit
5. Funeral Expenses

How To Get ESIC Pehchan Card Or ESI Card

 in order to get all those benefits employees need to have ESIC Pehchan card. So every employer must give print counter foil which will be downloaded from employer ESIC portal.

Learn About How To Get Forgotten ESIC Challan  Number In ESIC Portal

Print counter foil is a Pehchan card application form. On this  print counter foil employee doesn’t need to write any thing, every thing will be filled by employer’s HR department and employee need to submit a family photograph.

Family photograph should contain all the members who are going to take Pehchan card and this family photo will be attested by employer, and employee also need to sign on this ESIC Pehchan card application form.

After completing all this formalities employee need to take this print counter foil to their nearest ESIC office along with the family members. In ESIC office they will take photograph of insured person’s family and the card will be handed over to insured person i.e employee with in 20 days, by courrier or employer or some times employee need to visit ESIC office to get ESIC Pehchan card.

In case, if group of employees in an organization want to take ESIC cards collectively then the employer need to write a letter to ESIC office to send an officer to take photo graphs of all employees including their family members for Pehchan card purpose. So this is the process to get ESIC pehchan card.

Way to Change Employee Name In ESIC Portal

Do you want to know how to change employee name in ESIC  portal , then you are right place. Here you can know complete details about how to change IP name in ESIC portal.  ESIC name change process has to be done in offline mode, till now there is no online platform to change employee name in ESIC portal.But employer can change nominee details, family members details in ESIC employer portal.But in order to change employee name in ESIC portal there is offline facility.
But before knowing about how to change employee name in ESIC portal, we have to know reasons for wrong names in ESIC portal. This generally happen when your employer misspells employee name during registration process.

In order to change IP name in ESIC portal, employee needs to submit a request letter to correct his or her name to the their regional ESIC office. But make sure that the request letter should be attested by employer. With out attestation of employer Empoloyee State Insurance Corporation doesn’t change name of the employee. Here you can find and download sample ESIC name correction letter format.

ESIC name change letter

To                                                                                                                Date : 11-11-2017

The Branch Manager,

ESIC Office Addreess.

Sub : Correction Of IP name zzzzz bearing insurance number 9123xxxx832.

                  This to bring your kind notice that, the name of the above employee G Uday Bhaskar, ESIC No: 7123xxx456 has entered wrongly during registration process. His correct name is zzzz but in ESIC portal it has entered as B UDAY BHASKAR ,  so here we request you to please correct his name to zzzzz.

Thanking you in advance.

For Thexyz Company ltd

Authorized Signatory

Establishment Code : 92223456xxx4567891

ake this letter printout on company letter head. Finally after writing this letter either employee or employer needs to submit this letter in their regional ESIC office. With in 15-30 days ESCI will make the corrections to employee name.

Great News @Link Aadhar With PF Number Without Login In UAN Portal

Employee Provident Fund Organization (EPFO) has introduced the new online facility to link employees aadhar numbers with their PF UAN numbers. By using this facility EPF members can able to link Aadhar with PF number without login in UAN portal. But in order to link aadhar number with PF number, the aadhar number of the EPF member should be registered firstly with their mobile number. In case without a valid registered mobile number, it is not possible to link aadhar number and UAN number. Here is the process >

on next page click on LINK UAN AADHAR, on the same page, you can also track the status of EKYC by clicking on track eKYC

After clicking on link UAN aadhar, you will get a new page. Here you need to enter your UAN number & Aadhar number. First, you need to enter your UAN number, after entering UAN number the last 4 numbers of your EPF registered mobile number will automatically appear in mobile number field. Now click on generate OTP.

Now enter the OTP received to the mobile number linked with UAN and click on submit.

After clicking on submitting it will ask for proceed for OTP verification.

In new page you need to choose sms or email to receive OTP.  Once you receive OTP to your registered mobile number, enter it and click on validate OTP. Once your OTP get validated your Aadhar number will be linked with your UAN number & you will get the following message on the screen.

If your aadhar number is not linked with your mobile number then it is not possible to receive OTP. 

What is the difference between an unlisted public limited company and a private limited company?

There are numerous legal and practical differences between a Private Limited Co and A Unlisted Public Company but one major difference is that of restriction on transfer ability of shares. It's the biggest advantage of an Unlisted Co.

Unlisted Public company is more less same as Public Listed company difference being the company listed on a Stock exchange.

Why companies go for incorporating themselves as Unlisted Public Co., is that the Private limited Co., by its nature shall not transfer its shares to public and is restricted only among it's members.  

In layman terms the Unlisted company may be defined as a privately held companyor close corporation is a business company owned either by non-governmental organizations or by a relatively small number of shareholders or company members which does not offer or trade its company stock (shares) to the general public on the stock market exchanges, but rather the company's stock is offered, owned and traded or exchanged privately. More ambiguous terms for a privately held company are unquoted company and unlisted company. 

By law a Private Ltd co., enjoys many privileges and exemptions in areas where a Unlisted Public ltd. co is bound by several obligations, restrictions and legal compliances. but it is these legal compliances which makes a lender very comfortable to lend money to a Public ltd co., but not a Private ltd co.,

A publicly unlisted company is a company that can have an unlimited number of shareholders to raise capital for any commercial venture. Companies which are not listed publicly are more likely to engage in profit maximising behavior as their share capital structure makes it very easy to give its members financial returns. Unlisted companies are usually too small to qualify for a stock exchange listing, and do not usually advertise for investors

First It should be clear that mostly there are only two type of Companies Public Limited & Private Limited. ( other are One Person Co. , Company with or without Guarantee, with or without shares etc.)

Let me explain some points:

1. Listed Company : A Public Limited Company whose any Securities (Equity or Debt=Shares or Debentures ) Listed in any Stock Exchange like. Bombay Stock Exchange (BSE), National Stock Exchange (NSE) etc. Note: Actually Securities (shares or Debentures) are listed on Stock Exchange not Company.
2. Public Limited Company: which fulfill some condition : member limit Min. 7 to Unlimited, Shares are transferable without any restriction.. Note: When Public Limited Co. shares or Debentures listed in Stock Exchange, it automatically become Listed Public Co.
3. Private Limited Company: Which have Members (Min. 2 or Max. 200) & Restriction in transfer of shares. As the Member limited is only 200 & restriction in transferability of shares, It is like impossible to get shares listed in Stock Exchange by Pvt. Co.

So, the Final Conclusion are following:

Listed Public Co. = Public Limited Company + Securities listed in Stock Exchange

All other Company are Automatically Unlisted Company, Therefore Using Word“Unlisted” is not generally required.

What is 'Paid-Up Capital'

in a simple term Paid-up capital is the amount of money a company has received from shareholders in exchange for shares of stock. Paid-up capital is only created when a company sells its shares on the primary market directly to investors. When shares are bought and sold between investors on the secondary market, no additional paid-up capital is created because the proceeds of those transactions go to the selling shareholders, not the issuing company.

BREAKING DOWN 'Paid-Up Capital'

Paid-up capital, also called paid-in capital or contributed capital, is comprised of two funding sources: the par value of stock and additional paid-in capital. Each share of stock is issued with a base price, called its par. Typically, this value is quite low, often less than $1. Any amount paid by investors that exceeds the par value is considered additional paid-in capital, or paid-in capital in excess of par. On the balance sheet, the par value of issued shares is listed as common stock or preferred stockunder the shareholder equity section, depending on the type of stock issued.

For example, if a company issues 100 shares of common stock with a par value of $1 and sells them for $50 each, the shareholders' equity of the balance sheet shows paid-up capital totaling $5,000, comprised of $100 of common stock and $4,900 of additional paid-in capital.

Paid-Up vs. Authorized Capital

When a company wants to raise equity, it cannot simply sell off pieces of the company to the highest bidder. Businesses must request permission to issue public shares by filing an application with the agency responsible for the registration of companies in the country of incorporation. In the United States, companies wanting to "go public" must register with the Securities and Exchange Commission (SEC) before issuing an initial public offering (IPO).

The maximum amount of capital a company is given permission to raise via the sale of stock is called its authorized capital. Typically, the amount of authorized capital a company applies for is much higher than its current need so it can easily sell additional shares down the road if it has need of additional equity. Since paid-up capital is only generated by the sale of shares, the amount of paid-up capital can never exceed the authorized capital.

Importance of Paid-Up Capital

Paid-up capital represents money that is not borrowed. A company that is fully paid-up has sold all available shares, and thus cannot increase its capital unless it borrows money by taking on debt or gets authorization to sell more shares. A company's paid-up capital figure represents the extent to which it depends on equity financing to fund its operations. This figure can be compared to the company's level of debt to assess if it has a healthy balance of financing given its operations, business model and the prevailing standards in its industry

Authorized Share Capital

What is 'Authorized Share Capital'

Authorized share capital is the number of stock units that a company can issue as stated in its memorandum of association or its articles of incorporation. Authorized share capital is often not fully used by management in order to leave room for future issuance of additional stock in case the company needs to raise capital quickly. Another reason to keep shares in the company treasury is to retain a controlling interest in the company.

BREAKING DOWN 'Authorized Share Capital'

Depending on the jurisdiction, authorized share capital is sometimes also called "authorized stock," "authorized shares" or "authorized capital stock." In order to be fully understood, authorized share capital must be viewed in a context where it relates to paid-up capital, subscribed capital and issued capital. While all these terms are interrelated, they are not synonyms.

Breakdown of a Company's Capital

Authorized share capital is the broadest term used to describe a company's capital. It comprises every single share of every category that the company could issue if it needed or wanted to. Next, subscribed capital represents a portion of the authorized capital that potential shareholders have agreed to purchase from the company's treasury. Paid-up capital is the portion of the subscribed capital for which the company has received payment from the subscribers. Finally, issued capital is the shares that have actually been issued by the company to the shareholders.

For example, a company could have an authorized capital of one million common shares at a par value of $1 each, for a total of $1 million. However, the actual issued capital may be only 100,000 shares, leaving 900,000 in the company's treasury available for future issuance.

In the case of a startup, authorized share capital may be very high while actual issued capital is low to allow financing from eventual investors.

Authorized Share Capital of Public Companies

Stock exchanges may require companies to have a minimum amount of authorized share capital as a requirement of being listed on the exchange. For example, the London Stock Exchange requires that a public limited company have at least £50,000 of authorized share capital to be listed. Authorized share capital may be greater than the shares available for trading. In this case, the shares that have actually been issued to the public and to the company's employees are known as "outstanding shares."

For example, The Coca-Cola Company has an authorized share capital of 11.2 billion shares with a par value of 25 cents per share. However, it only has 4.33 billion outstanding share

Share certificates under Companies Act 2013

“Shares” As per Section 2(84) of Companies Act, 2013, Share means Share in the share capital of a Company and Include stocks.Share or Debentures are movable property transferable in Manner provided in the AOA of Company. (Sec-44)

TYPES OF SHARE CAPITAL

i. Authorized Share Capital

ii. Issued Shared Capital

iii. Subscribed Share Capital

iv. Paid up share capital

KINDS OF SHARE CAPITAL

i. Equity Share Capital

a) With voting right

b) With differential right

ii. Preference Share Capital

Share Certificate:

A share Certificate is a document issued by company evidencing that the person named in the certificate is owner of number shares of Company as specified in the Certificate.

Register Digital Signature Certificate

Role check for Indian companies is to be implemented in the MCA application. Role check can be performed only after the signatories have registered their Digital signature certificates (DSC) with MCA.

Once the role check is implemented, system shall verify whether the signature on the eform filed, is of signatory of the companY

· ·        

1

Click on the 'Register DSC' link available on the MCA portal homepage.

·         2

On the next screen, click on the 'Director' link on the left hand panel and fill-up your DIN. Please ensure that the DIN is approved and typed correctly.

·         3

System shall verify that the DIN is valid and approved. If the DIN is filled incorrectly or DIN filled is not approved, system will throw an error message to that effect.

·         4

Fill-up rest of the particulars and ensure that details filled are as per DIR-3. If the applicant has filed DIR-6, then fill the details as submitted in DIR-6 form.

·         5

Click on the 'Next' button. The system would verify the details.

·         6

If the details filled do not match with DIR-3/ DIR-6, as the case may be, for the reason that you do not have your DIN application details, you can get the details from the company in which you are a director.

·         7

If the details are correct, the system would prompt you to select the DSC.

·         8

Click on the 'Select Certificate' button to browse and select the certificate. Please ensure that the selected DSC belongs to the applicant, whose particulars are being registered.

·         9

System shall validate the DSC. If the selected DSC is already registered against given DIN, system will give an informatory message. If a different DSC is already registered against the given DIN, system will ask if the user wants to update his/ her DSC.

·         10

Type the displayed system generated text for verification in the box provided.

·         11

Click on 'I agree' button to agree to the declaration that details furnished are correct.

·         12

Click on the 'Submit' button to register your DSC.

·         13

Acknowledgement message is displayed to the user.

·         14

User can take a print-out of the acknowledgement.

·         15

The applicant can click on the 'Reset' function to clear the data in the fields.

Top

Step by step Process for Manager/Secretary/CEO/CFO

Step by step process to be followed for registration of Manager’s/Secretary’s/CEO's/CFO's DSC is as under:

·         1

Click on the 'Register DSC' link available on the MCA portal homepage

·         2

On the next screen, click on the 'Manager/Secretary/CEO/CFO' link on the left hand panel and fill-up the particulars. Please ensure that the Income tax PAN and other details are as per the information filed in DIN-3 Form.

·         3

Click on the 'Next' button. The system would verify the details.

·         4

If the details are correct, the system would prompt to select the DSC.

·         5

Click on the 'Select Certificate' button to browse and select the certificate. Please ensure ,that the selected DSC belongs to the applicant, whose particulars are being registered.

·         6

System shall validate the DSC. If the selected DSC is already registered against given PAN, system will give an informatory message. If a different DSC is already registered against the given PAN, system will ask if the user wants to update his/ her DSC

·         7

'Type' the displayed system generated text for verification in the box provided

·         8

Click on 'I agree' button to agree to the declaration that details furnished are correct.

·         9

Click on Submit button to register your DSC.

·         10

Acknowledgement message is displayed to the user.

·         11

User can take a print-out of the acknowledgement..

·         12

The applicant can click on the 'Reset' function to clear the data in the fields

Top

Step by step Process for Practising Professional

Step by step process to be followed for registration of Practising Professional's DSC is as under:

·         1

Click on the 'Register DSC' link available on the MCA portal homepage

·         2

On the next screen, click on the 'Practising Professional' link on the left hand panel and fill-up the particulars. Please ensure that the details filled as per the records of your professional institute.

·         3

Click on the 'Next' button. The system would verify the details from the records provided by the concerned professional institute.

·         4

If the membership or enrolment number is wrong or details filled do not match with the records provided by the professional institute, system will throw an error message to that effect. If you do not have the details as recorded by your Institute, you can get the details from your Institute.

·         5

If the details are correct, the system would prompt to enter the income tax PAN.

·         6

The applicant is asked to verify and confirm the PAN. On confirmation, the system would prompt to select the DSC.

·         7

Click on the 'Select Certificate' button to browse and select the certificate. Please ensure that the selected DSC belongs to the applicant, whose particulars are being registered.

·         8

Type the displayed system generated text for verification in the box provided.

·         9

Click on 'I agree' button to agree to the declaration that details furnished are correct.

·         10

Click on the 'Submit' button to register your DSC.

·         11

Acknowledgement message is displayed to the user.

·         12

User can take a print-out of the acknowledgement.

·         13

The applicant can click on the 'Reset' function to clear the data in the field