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Joe (entrepreneur)     19 June 2021

Can you register as limited liability without a partner?

1. I want to register a limited liability company for running a software business

2. I am alone and don't have any business partners. So I cannot register as pvt limited or LLP because they require 2 directors at least

3. I dont have any family members or friends who I can add as co-directors for pvt limited or LLP

4. I can register as "one person company" but even there it requires a nominee as successor. I dont have any friends or family members to add as nominee.

5. Only option left is to do business in personal name without limited liability (this is called sole proprietorship). this is not safe.

Is there no option for me then?



 8 Replies

CA Altamush Zafar

CA Altamush Zafar (GST Consultant)     19 June 2021

Well if you are single person then go for proprietorship. As for being safe as long as your intention is to do honest business it's perfectly safe.
Karan Prajapati

Karan Prajapati   19 June 2021

Sole proprietorship is the only option for you Sir
Heet Shah

Heet Shah (Tax Consultant)     19 June 2021

Why do you think sole proprietorshio is not safe? It has just few demerits like non corporate  but if you have businesses policy u are welcomed everywhere 

Heet Shah

Heet Shah (Tax Consultant)     19 June 2021

There are less regulation for sole proprietor. It more beneficial to go solo... Stay single stay happy

Joe

Joe (entrepreneur)     20 June 2021

in the software world it is common for big corporations to bully small entrepreneurs by taking them to court over frivolous matters which eventually fall in favour of the small entrepreneur. It is also possible that a company makes an honest mistake that results in a system glitch and big losses. in such cases, the proprietor should not have to fear losing his personal assets and future.

That is why limited liability is important to have even if the intention is to conduct honest business.

Joe

Joe (entrepreneur)     20 June 2021

to give an example, lets say I start a consulting business as sole proprietor and win a contract with a big company. as per the contract, if the software system I build for them causes them downtime or losses I would have to compensate them for the losses. Then I build the system with my honest intentions and hard work but the worst happens and it has a bug which no one noticed. now my company is expected to compensate for all the losses caused. now I might be forced to give up all my personal assets (even the ones I had before I started the company)

 

CA Altamush Zafar

CA Altamush Zafar (GST Consultant)     20 June 2021

Your requirement is genuine but there is no other option for a single person other than proprietorship and one person company.

Joe

Joe (entrepreneur)     20 June 2021

but even one person company requires a nominee compulsorily. the nominee is the one who would continue the business if the director is unable to run the business. so if there is no one to put as nominee then even one person company is not an option correct?


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