As a Chartered accountant, I get a lot queries to register a private limited company but seldom do people approach with the query of "What would be the best form of business organization for me?". I personally dig such clients with an inquisitive mindset.
So, how does one choose the best form of organization for their business. We all know about the popular business forms, so I will not bore you with them. The most popular one in today’s time being a private limited company. Almost every person wants to start their business as a private limited but they have no rationale behind this decision. It often seems like the obvious first step. But the repercussions of a private limited company are serious and people often miss them. They are hit by a enormous compliance burden almost instantaneously with late fees and penalties without any upper caping in several compliances.
People may find proprietorship as an easy option to incorporate or start with but its almost impossible to prove business commencement and closure in a proprietorship.
Partnerships and LLPs are another ordeal with little people having actual compliance knowledge relating to them and plus, additional tax burden than private limited companies seem to be another government scam altogether.
In short, the purpose you are trying to fulfil and your future goals should drive this decision rather than relying on subconscious notions. Ultimately, picking out a good consultant could be your first step towards your business/ financial goals.