New Company Incorporated? Complete INC-20A Before Starting Business
The incorporation certificate creates the company. It does not complete all the legal steps needed to begin operations.
The 180-day requirement
A company having share capital must generally file Form INC-20A within 180 days from incorporation, declaring that every subscriber has paid the value of shares agreed to be taken.
What is Form INC-20A?
INC-20A is the declaration for commencement of business under Section 10A of the Companies Act, 2013. It is filed by a director and professionally verified in the prescribed manner.
Share capital
Subscribers deposit the value of shares agreed in the incorporation documents.
Declaration
A director makes the prescribed commencement-of-business declaration.
Verification
The form is verified by a practising CA, CS or Cost Accountant as prescribed.
Important legal effect
Until the Section 10A requirements are completed, a company covered by the provision cannot commence business or exercise borrowing powers.
Who should examine INC-20A applicability?
| Situation | General position |
|---|---|
| New company having share capital | INC-20A applicability should be checked immediately after incorporation. |
| Company without share capital | Section 10A filing does not apply merely as an INC-20A requirement; other compliances may still apply. |
| Company not yet doing business | Inactivity does not itself remove the 180-day filing responsibility. |
Documents and checks for INC-20A
- Certificate of incorporation
- Memorandum showing subscribers and agreed shareholding
- Company bank-account details
- Bank statement showing subscriber share-capital receipts
- Confirmation that payment came from the respective subscribers
- Correct amount received from each subscriber
- Verification of the registered office
- Valid digital signature of the filing director
Common mistakes founders make
- Starting operations immediately after receiving the incorporation certificate
- Depositing share capital from an unrelated person’s bank account
- Receiving an amount that does not match the agreed subscription
- Treating a director’s loan as subscriber share capital
- Using the company bank account before completing the required review
- Waiting until the end of 180 days to collect bank evidence
- Forgetting the first-auditor appointment
Other immediate startup actions
For a non-government company, arrange the Board appointment of the first auditor within 30 days from registration.
Start accounting from the first transaction. Keep incorporation expenses, capital and director transactions separate.
Examine GST, professional tax, Shops and Establishments, PF, ESI and other registrations based on actual applicability.
Simple example
If two subscribers agreed to take shares worth ₹50,000 each, the company should verify receipt of the agreed subscription from both subscribers. A general transfer from one director without a clear subscriber-wise trail may create difficulty while preparing the declaration.
How Gururaaja Sanjay and Co can assist
We assist new companies with a post-incorporation compliance review, subscriber-capital verification, INC-20A preparation, first-auditor documentation and applicable tax registrations. Each filing is completed after reviewing the company’s documents and approval.
Has your company been newly incorporated?
Complete the post-incorporation review before beginning business or borrowing.
Call 7760252581 WhatsApp UsGeneral educational information verified on 4 October 2026 from Sections 10A and 139 of the Companies Act and MCA’s INC-20A instruction material. Applicability depends on the company’s constitution and facts.
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