Post-Incorporation Compliances for Company

Once a company is incorporated, a set of compliance-related formalities must be completed to maintain compliance as per the Companies Act, 2013. Non-compliance could lead to fines and penalties on the Directors and the Company. Hence, it is important for those incorporating a company to be aware of the post-incorporation compliance requirements of a company. In this article, we look at the post-incorporation compliances required for a company like statutory register maintenance, share certificates, auditor appointment, bank account opening and more.

Corporate Stationery

Post incorporation of a company, the company must purchase the following corporate stationery for use in company compliance matters:

Name Board: Companies are required to paint or affix the name of the company and the address of its registered office outside every office or place in which it carries on business.

Company Seal: A round seal bearing name of the company and a seal bearing the name of the company along with the designation of the authorised signatory could be purchased to help with the execution of PAN application and board resolution for the opening of a bank account. The requirement for embossing seal for a company has been removed in the Companies Amendment Act, 2015.

Letterhead: Must print the name and registered office address of the company on all letterhead, invoices, notices and other official documents of the company. It would require the letterhead of the company for the opening of a bank account.

Share Certificates: Company must deliver share certificates to all the subscribers of the company within a period of two months from the date of incorporation. Hence, post-incorporation of the company, the subscribers to the Memorandum of Association of the Company would deposit the money for the shares agreed to be purchased and take share certificates of the company in return.

Statutory Register: All companies are required to maintain a statutory register for the company containing information like a register of members, list of directors, charges, debentures and other matters pertaining to the shareholders and management of the company. Must regularly update the Statutory Register and kept at the registered office of the company.

Applying for Company PAN

The Income Tax Department uses the PAN to track all compliance and filings of an Income Tax Assessed using the PAN. PAN is a 10-digit alpha-number character issued in the form of a laminated card. It requires a PAN for the company to open a bank account, obtain tax registration, file compliances, etc.; hence, the first step post-incorporation of a company is applying for a PAN.

https://www.youtube.com/watch?v=I6ZnhW35_QE

PAN for the company can be applied online. On application, it provides a PAN acknowledgement form sign the acknowledgement form and also get a seal from the Director of the Company. Now, courier the signed document to the NSDL office for processing of the PAN application. PAN acknowledgement copy can be used to open a bank account. Hence, on obtaining the PAN acknowledgement, the process for opening of bank account can be started in parallel.

Opening of Bank for the Company

One of the main activity post incorporations of the company is the opening of the bank account in the name of the company. Since a company is a registered legal entity – recognized by law, the process for opening a bank account is relatively simple. As per the Reserve Bank of India’s KYC norms, it requires the following are documents to open a current account in the name of the Company:

Self-attested copies of Certificate of incorporation and Memorandum & Articles of Association;
Board resolution to open a bank account for Company ;
Power of Attorney granted to its managers, officers or employees to transact business on its behalf (if applicable);
Copy of PAN allotment letter;
Copy of the telephone bill;

Submit the documents with the self-attestation along with a seal of the company for the opening of the bank account. Hence, it is important to obtain a company seal and company letterhead after incorporation of the company.

Appointment of Auditor

After incorporation of a company, it requires the Board of Directors of the Company to appoint the first auditor of the Company, a Chartered Accountant within 30 days of incorporation. In case the Board of Directors fail to appoint an Auditor, then it must intimate the members of the Company, who in turn can appoint an Auditor within 90 days of incorporation of the company. The first Auditors of the Company will hold office until the completion of the first annual general meeting and would be eligible for re-appointment at the end of their term in office.

Commencement of Business Certificate

As per the Companies Amendment Act, 2015, it does not require the Certificate of Commencement of Business. Hence, there is no requirement for obtaining Business Commencement Certificate currently. Know more about Commencement of Business Certificate.

Back to Learn

Frequently Asked Questions

Common questions about Post.

After incorporating a company, it is mandatory to maintain statutory registers such as the register of members, directors, charges, and debentures. These registers contain essential information about the company's shareholders, management, and financial obligations. Maintaining these registers regularly updated is crucial for compliance with the Companies Act, 2013.

Applying for a PAN is one of the first steps after incorporating a company. The PAN is a unique identification number issued by the Income Tax Department, which is necessary for the company to open a bank account, obtain tax registrations, file compliance reports, and carry out various financial transactions. Without a PAN, the company cannot legally operate and comply with tax regulations.

After incorporating a company, it is essential to purchase corporate stationery items such as a name board displaying the company's name and registered office address, a company seal (optional), letterheads with the company's details, and share certificates for issuing to shareholders. These stationery items are necessary for official communication, legal documentation, and compliance purposes.

Opening a bank account in the company's name is crucial as it separates the company's finances from the personal finances of its owners or directors. It is a legal requirement for companies to maintain a separate bank account for all financial transactions related to the business. Additionally, having a company bank account is necessary for various compliance and reporting purposes.

After incorporating a company, the Board of Directors must appoint the first auditor, who is a Chartered Accountant, within 30 days of incorporation. If the Board fails to appoint an auditor, the members of the company can appoint one within 90 days of incorporation. The first auditor holds office until the first annual general meeting and is eligible for reappointment.

No, as per the Companies Amendment Act, 2015, it is no longer mandatory to obtain a Commencement of Business Certificate after incorporating a company in India. This requirement has been removed, simplifying the post-incorporation compliance process.

To open a bank account for a company, the following documents are typically required: self-attested copies of the Certificate of Incorporation, Memorandum and Articles of Association, Board Resolution authorizing account opening, Power of Attorney (if applicable), copy of PAN allotment letter, and a copy of a utility bill as proof of address.

The time taken to obtain a PAN for a company after incorporation can vary depending on the mode of application and the processing time at the respective authorities. Generally, if the application is complete and submitted online with all the required documents, the PAN can be obtained within a few weeks.

Yes, a company can start its business operations immediately after incorporation, as the requirement for obtaining a Commencement of Business Certificate has been removed under the Companies Amendment Act, 2015. However, the company must comply with all other post-incorporation formalities and legal requirements specified in the Companies Act, 2013.

Non-compliance with post-incorporation requirements specified in the Companies Act, 2013, can lead to fines and penalties imposed on the company and its directors. Failure to maintain statutory registers, appoint auditors, or comply with other legal obligations can result in legal actions and affect the company's credibility and reputation.