INC 20A Filing (Declaration for the Commencement of Business)
Incorporating a company in India is just the beginning of a long journey toward establishing a successful business. One of the critical compliance requirements that newly incorporated companies must fulfill is the filing of Form INC-20A, known as the Declaration for Commencement of Business. This form serves as a formal declaration that the company has received the subscription money for its shares and is ready to commence its business operations.
Who Needs to File INC 20A?
Any Private Limited Company, Public Company, or One Person Company (OPC) that
Was incorporated on or after November 2, 2018, and
Has share capital
needs to file Form INC 20A.
Timeline: When to File INC 20A?
Form INC 20A must be filed within 180 days from the date of incorporation of the company.
For example, if your company was incorporated on January 1, 2025, you must file INC 20A by June 30, 2025.
It is advisable not to wait till the last day, as delays can attract penalties and restrict your business operations.
Why is INC 20A Filing So Important?
1. Legal Compliance
It is a legal requirement under Section 10A of the Companies Act, 2013. Not filing it means your company is not authorized to start business.
2. Avoid Penalties
Missing the INC 20A deadline will result in financial penalties for both the company and its directors.
3. Bank Account Verification
You must show proof that the company received share money in its official bank account. This ensures the company is financially active.
4. Protect Director Status
Non-compliance can lead to directors being labeled as defaulting officers, which affects their reputation and ability to serve on other company boards
INC 20A Filing Process
Filing Form INC 20A is simple if you follow the correct steps. Here’s how:
Step 1: Open a Company Bank Account
Once your company is incorporated, open a current account in the company’s name. Ensure that all subscribers deposit the promised share capital.
Step 2: Collect Proof of Share Capital
You’ll need a bank statement or certificate showing that the share capital amount has been credited to the company’s bank account.
Step 3: Prepare the Declaration
A director of the company must sign a declaration stating that:
- All shareholders have paid their part of the share capital.
- The company is ready to start operations.
This declaration is made through Form INC 20A, which must be filed online.
Step 4: Attach Supporting Documents
You must attach the following documents with the form:
- Bank statement showing receipt of capital
- External and Internal Photograph of Registered office with Directors and Office board
- Board resolution (optional but recommended)
- Professional certification from a Chartered Accountant (CA), Company Secretary (CS), or Cost Accountant
Step 5: File the Form on MCA Portal
- Log in to the MCA portal (www.mca.gov.in)
- Fill out the INC 20A form
- Attach the required documents
- Get the form digitally signed by a director and a professional
- Pay the applicable government fees
Government Fees for INC 20A Filing
The government fee depends on your company’s authorized share capital:
| Share Capital | Fees (INR) |
|---|---|
| Up to ₹1,00,000 | ₹200 |
| ₹1,00,001 to ₹4,99,999 | ₹300 |
| ₹5,00,000 to ₹24,99,999 | ₹400 |
| ₹25,00,000 to ₹99,99,999 | ₹500 |
| ₹1 Crore or more | ₹600 |
Penalties for Not Filing INC 20A
Missing the filing deadline can have serious consequences:
1. For the Company
A penalty of ₹50,000 will be levied.
2. For Each Director
Each director will be fined ₹1,000 per day, up to a maximum of ₹1,00,000.
3. Other Consequences
- Your company will not be able to borrow money legally.
- You cannot issue shares or raise funds.
- MCA may strike off the company from its records.
- Directors may face disqualification under other compliance laws.
Apply for INC20A filing
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