How to set up an IT Company in Ahmedabad
How to Setup an IT Company in Ahmedabad
With a CAGR of 48% in IT investments over the decade from INR700.0 crores in 2005-06 to INR35,200.0 crores in 2015-16, the popularity of the Gujarat state in the IT sector has reached a new high. In 2018, the state accounted for more than 5,500 ICT companies, which includes 10% large entities, 30% medium entities, and 60% small enterprises. Let’s see how to Set up an IT Company in Ahmedabad.
The Gujarat government is working tirelessly to promote the development of the sector with positive policies and regulations that can encourage the incorporation of IT companies in the state. Specifically, the development of the state as an SME industrial ecosystem along with other new-age concepts of artificial intelligence, robotics, the internet of things, and machine-to-machine can give the required impetus to the IT industry growth. The proposal for the development of a technology hub in Ahmedabad can provide the right direction needed to Set up an IT Company in Ahmedabad and create a vibrant IT ecosystem in the city.
Information Technology (IT) and IT-enabled Services (ITeS) were accorded bonafide industry status on October 14, 2019, in the Gujarat state to improve the ease of doing business. Such a status means more development opportunities for the IT industry, which will result in an increased generation of employment. The state government’s ‘Gujarat State New IT Policy of 2016-21’ aims to develop a robust IT/ITeS ecosystem that contributes to the prosperity of the state and hence the nation. The key objectives of this policy were:
Set up an IT Company in Ahmedabad – an ideal destination for IT companies
Some of the key factors that contribute to making Ahmedabad a preferred destination for IT companies are as follows:
Registration procedure for IT companies: How to Set up an IT Company in Ahmedabad
Deciding on the legal structure of the company
The first step is to decide on the legal structure in which the owner/s intends to operate the company. The options available include One Person Company, Limited Liability Partnership, Private Limited Company, Partnership Firm, and Sole Proprietorship Firm. Entrepreneurs thinking to Set up an IT Company in Ahmedabad choose the legal form depending on the business structure and the vision they intend to achieve. The comparison between various legal structures must be made based on the prerequisites, costs involved, advantages, and disadvantages.
Selecting the right business structure is a critical step since an entity’s income tax returns depend on it. The legal compliances that the entity has to abide by annually depend on the legal structure. Furthermore, some legal structures of business are observed as more investor-friendlier than the other structures because the investors find the former to be generating more returns. Therefore, every entrepreneur, before registration and incorporation of the company, must think carefully about the type of business structure he/she intends to form. The decision is based on the following factors and principles:
The number of owners/partners in a business:
Income tax rates imposed on the business type:
Risks of a business:
Multiple compliances and increased complexities:
Selecting the business name or company name or brand name
The company name must be in three parts: The keyword, which is the brand name, followed by the business activity word, which shows the key business activity of the entity’s operations and last is the structure word, which shows the type of company – LLP or private limited or any other. The keyword (brand name) must not be the same as any other company’s name.