Quick answer: A private limited company is the standard Indian business entity under the Companies Act, 2013. Its articles restrict share transfers, cap members at 200 and bar public offers of securities. Liability is limited to share capital. It needs at least 2 directors and 2 members, with one director resident in India for 182 days a year.
- Incorporation runs through SPICe+ (INC-32) on MCA21 V3, which also issues DIN, PAN and TAN.
- No incorporation fee applies for authorised capital up to ₹15 lakh.
- Every company needs a statutory audit each year, whatever its size.
- Small company limits rose to ₹10 crore paid-up capital and ₹100 crore turnover from 1 December 2025.
What does Indian law require of a Pvt Ltd company?
Section 2(68) of the Companies Act sets three features. The articles of association must restrict the right to transfer shares, limit members to 200 and prohibit invitations to the public to subscribe.
Then the people. Two directors minimum, up to 15 without a special resolution, and at least one of them must have stayed in India 182 days or more in the financial year under section 149(3). Two members minimum.
The founding documents are the memorandum of association, which states the objects and capital, and the articles, which set internal rules. Once the ROC approves, you get a certificate of incorporation showing the 21-character CIN, with PAN and TAN printed on it.
How does Pvt Ltd registration in India work?
One form does most of the work. Pvt ltd registration India runs through SPICe+, which the MCA describes as eleven services in one:
- Part A reserves the name.
- Part B incorporates the company and allots DIN for up to 3 directors.
- PAN and TAN come with the certificate.
- The linked AGILE-PRO-S form registers EPFO and ESIC, with optional GSTIN and bank account opening.
After incorporation, the board appoints the first auditor within 30 days. INC-20A, the commencement of business declaration, is due within 180 days.
What changes if the company is small?
| Test | Small company limit since 1 December 2025 |
|---|---|
| Paid-up capital | Up to ₹10 crore |
| Turnover | Up to ₹100 crore |
| Exclusions | Holding companies, subsidiaries, section 8 companies, special-Act companies |
Small companies need only two board meetings a year, one in each half, at least 90 days apart. But a foreign-owned subsidiary is excluded from small company status, however small it is.
When does a Pvt Ltd make sense compared with an EOR?
When you need to own the business in India as well as employ people there.
A private limited company can sign Indian contracts, hold IP and assets, invoice local customers and take investment. Real strengths. But it also brings a resident director, an annual audit, ROC filings and FEMA reporting from the very first year, whether the team is three people or three hundred.
An EOR skips all of that. Suppose you are a US founder hiring three developers in Pune. Through an EOR they join a compliant Indian payroll quickly, and you decide on an entity only once revenue or headcount justifies it. Our guide on starting a startup in India covers the founder view.
How does Remunance help you choose between Pvt Ltd and EOR?
Remunance is itself a private limited company, Remunance Services Pvt Ltd in Kothrud, Pune, so we know the compliance load first-hand. We can employ your team now, then set up your own company through our India subsidiary formation service when the time is right. Compare EOR and Pvt Ltd costs with our team before you register anything.
What else do people ask about private limited companies?
Can a foreigner be a director of a private limited company in India?
Yes. Foreign nationals can be directors, but at least one director on the board must meet the 182-day Indian residency test.
How many members can a private limited company have?
Between 2 and 200. Current employees who hold shares, and former employees who became members while employed, do not count towards the cap, and joint holders count as one.
Is audit compulsory for a private limited company?
Yes. Every company, whatever its turnover, must appoint a statutory auditor and have its accounts audited each year.