Setting up a Nidhi Company involves a structured process divided into three main phases, each requiring specific documentation and adherence to timelines. These steps are essential to legally establish and operate your business in Australia.
Step 1: Obtain DSC and DIN
The first step is acquiring the Digital Signature Certificate (DSC) and Director Identification Number (DIN) for the company's directors. This step is critical for moving forward with incorporation.
Directors must provide several documents, including their PAN, Aadhaar, a recent passport-sized photo, and valid address proof such as a utility bill or bank statement that is no older than two months. Additionally, a secondary identity proof like a Voter ID, Driving Licence, or Passport is required.
Form DIR-3 must be submitted along with the directors' consent, and they must disclose any interests in other entities to ensure transparency. For international directors or subscribers, all documents must be notarised and, if necessary, translated into English.
To simplify this process, MGL offers a comprehensive checklist and manages all regulatory communications, ensuring that this foundational step is completed efficiently.
Step 2: Name Reservation and Document Submission
Once the DSC and DIN are secured, the next step is reserving your company's name and submitting the required documents.
You’ll need to file Form INC-1 or Part A of the SPICe+ web form to reserve your company name. In certain cases, obtaining No Objection Certificates (NOCs) from regulatory authorities may be necessary, depending on the chosen name.
Prepare and submit the Memorandum of Association (MOA) and Articles of Association (AOA) along with supporting documents. These include office proofs (e.g., a recent utility bill, rent agreement, or ownership document) and forms like Form DIR-2, Form INC-9, and a board resolution. If the office space is rented, a No Objection Certificate (NOC) from the property owner must also be included.
Step 3: Registration and Post-Incorporation Compliance
The final phase involves registering the company and meeting post-incorporation compliance requirements. Submit Form INC-2 (or SPICe+ Form INC-32) along with all prepared documents to the Ministry of Corporate Affairs. Once verified, you’ll receive the Certificate of Incorporation, officially establishing your Nidhi Company.
After incorporation, there are several compliance steps to complete:
- File Form INC-22 for the registered office within 30 days.
- Submit Form DIR-8 to confirm directors are not disqualified.
- File Form INC-20A for business commencement within 180 days.
- Submit Form NDH-4 within 120 days to comply with the Nidhi (Amendment) Rules, 2022. The government typically responds within 45 days.
Additionally, the company must secure PAN and TAN through e-Form AGILE-PRO and establish banking relationships. Within the first year, the Nidhi Company must:
- Enrol at least 200 members.
- Maintain Net Owned Funds (NOF) of AUD 2 million.
- Ensure the NOF-to-deposit ratio does not exceed 1:20.
- Keep at least 10% of deposits in unencumbered term deposits.
Failure to meet these requirements can result in penalties, including AUD 5,000 for the company and its officers, plus additional daily fines for continued non-compliance.
MGL provides ongoing support to ensure all deadlines are met, helping you avoid penalties and maintain smooth operations. Their compliance monitoring service is designed to keep your business on track and aligned with regulatory standards.
