Am planning to setup a pvt ltd firm with me + 1 as a director and I had the below query:
In order to save taxes and to claim expenses ( rent/internet bills etc ), I need to show my trading income as business income and in order to do this, do I need to open a trading account in the name of my PVT LTD company or as I already hold an account with Zerodha and I am one of the director, I can still do this using my existing trading account which is under my name as an individual ?
@aneeshcr When you set-up a limited liability company (Pvt. ltd.) essentially it separates you from your business. The company is distinct from it’s shareholders and that is why it has it’s own PAN , TAN etc. So, you cannot use your existing personal trading account. You need to open a new trading account in the name of your company.
You need to think in a manner that companies are legally separated from you and your personal assets. In this sense, you will not be able to use any of your private accounts in order to conduct business activity. Legally, your company is separate entity
Only separate account on newly registered company. And moreover don't make mistakes like some people did in past linking that personal and business trading accounts somewhere, it created lot of mess which costed way too much too fix and it was too late.
Your company liability is it’s own funding or liquid capital I already do not remember how much and what is it really. I do not care as long as it all works anyway. I do not even understand how you couldn’t see the difference, I would delete one of accounts from the system.