MCA revises threshold for paid up capital of “small companies”

0
492
US Dollar - The Global Currency
US Dollar - The Global Currency
0 0
Azadi Ka Amrit Mahoutsav

InterServer Web Hosting and VPS
Read Time:1 Minute, 57 Second

MCA revises threshold for paid up capital of “small companies”

Latest revision to facilitate Ease of Doing Business further and reduce compliance burden on “small companies”

By PIB Delhi

The Ministry of Corporate Affairs (MCA) has taken several measures in the recent past towards ease of doing business and ease of living for the corporates.  These included decriminalisation of various provisions of the Companies Act, 2013 & the LLP Act, 2008, extending fast track mergers to start ups, incentivising incorporation of One Person Companies (OPCs) etc. Earlier, definition of “small companies” under the Companies Act, 2013 was revised by increasing their thresholds for paid up capital from “not exceeding Rs 50 lakh” to “not exceeding Rs 2 crore” and turnover from “not exceeding Rs 2 crore” to “not exceeding Rs 20 crore”. This definition has, now, been further revised by increasing such thresholds for paid up Capital from “not exceeding Rs. 2 crore” to “not exceeding Rs. 4 crore” and turnover from “not exceeding Rs. 20 crore” to “not exceeding Rs. 40 crore”.

Small companies represent the entrepreneurial aspirations and innovation capabilities of lakhs of citizens and contribute to growth and employment in a significant manner. The Government has always been committed to taking measures which create a more conducive business environment for law-abiding companies, including reduction of compliance burden on such companies.

Some of the benefits of reduction in compliance burden as a result of the revised definition for small companies are as under:

  • No need to prepare cash flow statement as part of financial statement.
  • Advantage of preparing and filing an Abridged Annual Return.
  • Mandatory rotation of auditor not required.
  • An Auditor of a small company is not required to report on the adequacy of the internal financial controls and its operating effectiveness in the auditor’s report.
  • Holding of only two board meetings in a year.
  • Annual Return of the company can be signed by the company secretary, or where there is no company secretary, by a director of the company.
  • Lesser penalties for small companies.

The relevant notification issued by the Ministry of Corporate Affairs is available on the Ministry’s website at the following link:

https://www.mca.gov.in/bin/dms/getdocument?mds=tiMs9IFJ8xuPm%252B%252Foxc6fUw%253D%253D&type=open

Click to see the notification: Small Companies Notification

About Post Author

Suman Munshi

Founder Editor of IBG NEWS (15/Mar/2012- 09/Aug/2018). Recipient of Udar Akash Rokeya Shakhawat Hossain Award 2018. National Geographic & Canon Wild Clicks 2011 jury and public poll winner. Studied Post Graduate Advance Dip in Computer Sc., MBA IT,LIMS (USA & Australia), GxP(USA & UK),BA (Sociology) Dip in Journalism (Ireland), Diploma in Vedic Astrology, Numerology, Palmistry, Vastu Shastra & Feng Sui 25 years in the digital & IT industry with Global MNCs' worked & traveled in USA, UK, Europe, Singapore, Australia, Bangladesh & many other countries. Education and Training advance management and R&D Technology from India, USA, UK, Australia. Over 30 Certification from Global leaders in R&D and Education. Computer Science Teacher, IT & LIMS expert with a wide fan following in his community. General Secretary West Bengal State Committee of All Indian Reporter’s Association
Happy
Happy
0 %
Sad
Sad
0 %
Excited
Excited
0 %
Sleepy
Sleepy
0 %
Angry
Angry
0 %
Surprise
Surprise
0 %

Advertisements

IBG NEWS Radio Services

Listen to IBG NEWS Radio Service today.


InterServer Web Hosting and VPS

Brilliantly

SAFE!

2022

LEAVE A REPLY

Please enter your comment!
Please enter your name here