What is a Small Company ?
Small company is a new term coined by the new companies act 2013. In view to promote more people to register a company, the new companies act had made relaxations who fall within the meaning of small companies for new startups or small businesses.

The act defines small companies as:
‘‘small company’’ means a company, other than a public company,—

• paid-up share capital of which does not exceed fifty lakh rupees or such higher amount as may be prescribed which shall not be more than five crore rupees; or
• turnover of which as per its last profit and loss account does not exceed two crore rupees or such higher amount as may be prescribed which shall not be more than twenty crore rupees: Provided that nothing in this Section shall apply to—
  1. a holding company or a subsidiary company;
  2. a company registered under Section 8; or
  3. a company or body corporate governed by any special Act;

To qualify for relaxations as to small companies your registered company shall fulfill the following conditions

• Your company should not be a public company
• Your paid-up share capital should not exceed fifty lakhs
• Your turnover as per the last profit & loss account should not exceed two crore rupees
• Your Company Shall not be a holding or a subsidiary company
• Your company shall not a company registered under section 8 or any special acts

What are the relaxations available to small companies:

• A Small Company need not retire the auditors by rotation
• A Small Company need not present a Cash Flow Statement
• Annual Return can be signed by a director/Company Secretary
• Two board meetings annually are sufficient for a small company