Trading as a private limited vs individual ? Pros and Cons?


Me and My father wants to start trading. So we got a doubt of how should we proceed?

  1. as two individuals , with two separate accounts ?

  2. Both register a company (pvt ltd) and trade with one account ?

I would like to know the pros and cons of both scenarios ? in Trading as well as in Saving income tax …

In my limited knowledge, I am hoping that we can save lot of tax by showing operational expenditure. Is my understanding correct ??

Fresh Trader

1 Like

better to consider your accountant

1 Like

Im assuming you are putting after tax income into it, so no savings there.
If you trade with a partnership/ Pvt. Ltd, you can claim deductions for expenses you incur while trading, this could include office rent, electricity expenses, etc while you will not be able to claim this in an individual account.
Consult a CA or Tax Advisor for detailed information