You have your Certificate of Incorporation. Congratulations! But a new company is not fully free to do business until it files one more form: INC-20A, the declaration for commencement of business. Missing it is one of the most common and costly mistakes new founders make. This guide explains it in plain words.
What is INC-20A?
Form INC-20A is a declaration filed with the Registrar of Companies (ROC) under section 10A of the Companies Act, 2013. A director declares that every subscriber to the memorandum has paid the value of the shares they agreed to take, and that the money has reached the company's bank account.
It exists to stop "shell" companies that are registered but never really funded.
Who must file INC-20A?
| Company type | Need INC-20A? |
|---|---|
| Private limited company with share capital | Yes |
| One Person Company (OPC) with share capital | Yes |
| Public company with share capital | Yes (it also needs to meet other conditions) |
| Company without share capital (e.g. many Section 8 companies) | No |
| LLP | No (INC-20A is for companies) |
Due date: 180 days from incorporation
INC-20A must be filed within 180 days of the date of incorporation shown on your certificate. In that time you need to:
- Open a current account in the company's name.
- Get each subscriber to transfer their share subscription money into it.
- File INC-20A with proof of that payment.
Documents for INC-20A
- Proof of payment of subscription money by each subscriber, usually the company's bank statement showing the credits
- Certificate of Incorporation details (CIN)
- DSC of a director to sign the form
- Certification by a practising professional (CA, CS or Cost Accountant)
- If the company's business needs a sector regulator's approval (for example, RBI or SEBI), a copy of that approval
How to file INC-20A
- Open the company bank account and make sure subscription money is received from every subscriber.
- Download the bank statement showing the deposits.
- Log in to the MCA V3 portal and open Form INC-20A.
- Enter the CIN; company details auto-fill.
- Attach the bank proof and any regulatory approval.
- Get it signed by a director and certified by a professional with their DSCs.
- Pay the government filing fee and submit. Save the SRN.
Penalty for not filing INC-20A
Section 10A(2) sets heavy penalties:
- Company: ₹50,000.
- Every officer in default: ₹1,000 for each day the default continues, up to a maximum of ₹1,00,000.
On top of that, the company cannot commence business or exercise borrowing powers until the declaration is filed. If the ROC believes the company is not carrying on business, it can start action to strike off the company's name.
What "commence business" means in practice
Until INC-20A is filed, the company should avoid:
- Starting operations or signing commercial contracts
- Taking loans or borrowing money
- Issuing invoices in the company's name
Some registrations you may apply for early (for example GST or a bank account) do not replace INC-20A.
A simple checklist for the first 180 days
First 30 days
- Hold the first Board meeting.
- Appoint the first auditor (see our ADT-1 guide).
- Open the company bank account.
By day 60
- Collect subscription money from all subscribers.
- Issue share certificates once money is received (within the time allowed by law).
Before day 180
- File INC-20A with bank proof.
- Keep a copy of the SRN and filed form with your statutory records.
Common mistakes
- Paying from someone else's account. Each subscriber should pay from their own account so the trail is clear.
- Waiting for a big first deal. The 180-day clock runs from incorporation, not from your first sale.
- Thinking the certificate is enough. Incorporation is step one; INC-20A is step two.
- Ignoring it for a dormant company. The penalty still applies.
Planning the first year? Our private limited company annual compliance checklist shows what comes next.
Frequently asked questions
What is INC-20A?
INC-20A is the declaration for commencement of business under section 10A of the Companies Act, 2013. A director confirms that subscribers have paid for their shares into the company's bank account.
What is the due date for INC-20A?
It must be filed within 180 days of the date of incorporation.
What is the penalty for not filing INC-20A?
The company faces a ₹50,000 penalty, and every officer in default faces ₹1,000 per day of continuing default, up to ₹1,00,000. The company also cannot start business or borrow until it files.
Does an LLP need to file INC-20A?
No. INC-20A applies to companies with share capital. LLPs have their own filings under the LLP Act.
Can a company start business before filing INC-20A?
No. Under section 10A, a company with share capital cannot commence business or exercise borrowing powers until the declaration is filed.
Get it done right
Just incorporated, or close to the 180-day mark? Our team can check your subscription proof and file INC-20A for you. Register your company with TaxQue →
