Selecting a right kind of Business Entity before starting your business in India

Points of Comparison	Private Limited Company	Limited Liability Partnership (LLP)	One Person Company (OPC)	Partnership Firm	Sole Proprietorship Firm
Suitable for	Persons who have a definite plan and vision and are looking for a prospective investors to fund their project.	Venture is an experiment and the founders are not sure about the growth of the venture.	One individual who has a well-defined business plan and is looking to start a small venture but he is sure that it will grow as the venture grows	Where two or more persons want to run their Venture locally in a specific area only	A person who wants to experiment with the venture and want to get an idea about the market potential.
Registration Time*	5 to 10 working days	5 to 10 working days	5 to 10 working days	Not Compulsory but advisable 7-10 days	No registration required as such.
Minimum People required	2 Shareholders & 2 Directors (Can be same persons)	2 Partners	1 Shareholders & 1 Directors (Can be same persons)	2 Partners	1 Person
Minimum Capital	No minimum capital Requirement. (Can be started with even INR 1000/-	No minimum capital Requirement. (Can be started with even INR 1000/-	No minimum capital Requirement. (Can be started with even INR 1000/-	No minimum capital Requirement. (Can be started with even INR 1000/-	No minimum capital requirement.
Personal Liability	Shareholders and directors are not personally liable for the acts of the company but can be fined and/or imprisoned in their official capacity	Partners are not personally liable for the acts of the LLP but can be fined and/or imprisoned in their official capacity	Shareholder not personally liable for the acts of the company but can be fined and/or imprisoned in his official capacity	Partners shall be personally liable for the acts of the firm.	Personally Liable
Statutory Compliances	Substantial  Compliance	Lesser Compliance	Substantial  Compliance	Practically  no compliance	Practically  no compliance
Investors Perspective	Most preferred and shows seriousness of founders.	Less Preferred	Not Applicable unless converted into a Private Limited Company	Not Applicable	Not Applicable
Cost of maintaining	Higher	Relatively Lesser	Higher	Nominal	Very Nominal
Appointment of Auditors	Compulsory	Only when Turnover/Gross Receipts exceed the prescribed limit i.e. 40 lakh	Compulsory	No Requirement	No Requirement