MLM Company Registration in India

MLM Company Registration in India

MLM Companies are related with modern marketing and unique from traditional marketing style. MLM companies use network and chain marketing to advertise unique brands which are usually produced through homes by local vendors. To start a MLM Company in India, individuals need to register a company first and then follow some usual steps to register a MLM company in India. In this article, you’ll get complete details related to MLM Company Registration in India including documents required, its procedure, benefits and guidelines by the Government.

What is MLM Company?

MLM Company popularly known as Multi-Level Marketing Company is a business structure which mainly focuses on marketing professional strategy. The main purpose of this company is to create an organised pyramid structure so that the salesman not only sells the product or service but also ensures that the people carry the chain to sell the product further as well. Through this method, they not only generate the sales but also promote it through mouth publicity. However, there are some major guidelines which should be followed to run a MLM Company in India.

Document List for MLM Company Registration

In order to register an MLM Company in India, there are some documents that should be arranged before applying for the application. These documents are as follow:

1. MoA & AoA: Draft Memorandum of Association & Article of Association of company is required for the incorporation process of MLM Company. MoA must include all the clauses of the company and AoA should contain all the rules & responsibility within the company mainly includes MLM Related Objects.
2. PAN & TAN: Permanent Account Number & Tax Deduction and Collection Account Number of Director and shareholders both are required.
3. DIN & TIN: Copy of Director Identification Number & Taxpayer Identification Number both are required.
4. GST Registration: Copy of GST Registration Certificate along with GST Return Filing copies are required for the incorporation process.
5. Copy of ITR: Copy of Income Tax Return filing with the concerned authority is required.
6. TDS Statement: Direct sellers’s Tax Deducted at Source (TDS) Statement is needed along with their respective challans.
7. Latest P&L Account: Profit and Loss Account’s latest statement along with Balance Sheet & auditor’s report are required.
8. Record KYC: Copy of recorded statement of Know Your Customer (KYC) Formats on the website.
9. Utility Bill: Utility Bill of registering company is required for the verification of Company’s Address.
10. NOC: Along with Utility Bill, NoC (No Objection Certificate) is needed from the owner of the property. In case of rented Property

MLM Company Registration Process

In order to register an MLM Company in India, there are multiple steps that should be followed in the proper manner. These steps are as given below:

Step 01: Incorporate as a Company

In order to start a MLM Company, first incorporate as LLP or a Company under Companies Act, 2013. One can register a Private Limited Company, Public Limited Company, One Person Company, Section 8 Company, etc. Without Incorporation certificate approved by RoC, MLM Company Registration is impossible.

Step 02: Go through Statutory Guidelines

Once you obtain Incorporation Certificate, go through the Statutory Guidelines & Formalities issued by the Central and State Government. Also, some important factors to be considered such as:

• Shop & Establishment Act
• Trade License
• Taxation Laws
• Custom Duty Law
• Legal Metrology Act
• Consumer Protection Act
• Sector Specific Laws

Step 03: IDSA Membership

Once, you are aware of all the statutory formalities, next you should apply for IDSA Membership. IDSA stands for Indian Direct Selling Association. It is a private body setup by Amway India. The purpose of setting up IDSA is to stop the illegal & unethical MLM Companies in India.

Step 04: Obtain Necessary Licenses & Registration

After applying for IDSA Membership, obtain necessary licenses & registration depending on the business industry such as Service Tax, VAT (Value Added Tax), TAN (Tax Deduction Account Number), etc.

Step 05: File Undertaking with MCA

After obtaining all the required licenses and documents, now you need to file an undertaking within 90 days of the incorporation. Delay in filing this undertaking led to rejection of MLM Company.

Step 06: Business Growth

After filing the undertaking, now you are set for multi-level marketing for the growth of the business.

Guidelines for MLM Company Registration

Before Applying for MLM Company Registration, it is advised to go through the following Guidelines issued by the Government in India to run a MLM Company. Following is the list of guidelines issued by the Government of India.

• For Applying for MLM Company Registration, company must have a bank account with any national bank (with the company name)
• Nature of Business should be clearly mentioned in the MoA
• Consumer complaint corner should be there on the website
• Companies should pay the sales incentives within the decided time at the decided rates.
• Companies must display the Director’s Identification Number on the official website.

Benefits of MLM Company Registration

Registering a MLM Company in India offers you multiple benefits and they are as follow:

• Cost Effective Strategy: MLM or Multi-Level Marketing is one of the cost-effective methods to promote the business without spending too much on advertising.
• Flexibility: MLM companies offer jobs with flexible working hours which helps people to use their spare time in some productive work.
• Tax Advantages: Most of the MLM’s run by small entrepreneurs who produce the products on their own and then sell them on a large scale, that’s the reason they get tax advantages.
• Modernization: Traditional way of marketing takes time & efforts while network or chain market is the new & modern way of marketing. It also helps in achieving a big platform for marketing.

Why Choose Bizfoc?

Bizfoc is one of the trusted consultants in India with 1000+ company registration. We have a team of professional experts who have experience in registering a MLM Company in India. We offer the most cost effective price and make sure to assist you throughout the registration process, so that you can focus on your business goals. We ensure that your company follows guidelines issued by the Government for completing the registration process. Start your MLM Company in India Now!

Frequently Asked Questions