Companies Act Thresholds explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Many Companies Act duties start only when a company crosses a size line, and the lines sit in different sections and rules. This guide puts them in one table, each with the company type, the threshold as printed, the date on which size is tested and the provision. It reads the Companies Act, 2013 in the Ministry's consolidated text (last updated 29 July 2022) and the Rules as consolidated in the Ministry's e-book, consulted on 3 October 2026; the Managerial Personnel Rules are the 2014 text as notified. Later amendments, including to thresholds, should be checked before you rely on any row. Private companies have exemptions from some provisions by notification under section 462; check whether one applies.
The current small company limits in the e-book are paid-up capital not exceeding rupees ten crores and turnover not exceeding rupees one hundred crores, substituted by Amendment Rules dated 1 December 2025; a public company, holding or subsidiary company, Section 8 company and company governed by a special Act cannot be a small company. Other thresholds below are printed as they stand in each text, with the section or rule in the same row. The new small company limits change what applies to a company that moves under them; the last section lists the provisions that name small companies.
The master table
| Requirement | Who | Threshold as printed | Test date as printed | Provision |
|---|---|---|---|---|
| Small company | A company other than a public company, and not a holding, subsidiary, Section 8 or special Act company | Paid-up capital not more than rupees ten crores; turnover not more than rupees one hundred crores | Turnover as per the profit and loss account for the immediately preceding financial year (section 2(85)(ii)) | Section 2(85); Specification Rules, rule 2(1)(t) |
| CSR committee and spending | Every company | Net worth of rupees five hundred crore or more, or turnover of rupees one thousand crore or more, or net profit of rupees five crore or more | The immediately preceding financial year | Section 135(1) |
| Woman director | Every listed company; every other public company with paid-up capital of one hundred crore rupees or more or turnover of three hundred crore rupees or more | At least one woman director | Last date of the latest audited financial statements | Section 149(1); Appointment Rules, rule 3 |
| Independent directors | Listed public company: at least one-third. Unlisted public company with paid-up capital of ten crore rupees or more, turnover of one hundred crore rupees or more, or outstanding loans, debentures and deposits exceeding fifty crore rupees: at least two | As stated | Last date of the latest audited financial statements | Section 149(4); rule 4 (a joint venture, wholly owned subsidiary and dormant company are excluded by rule 4(2)) |
| Audit committee and nomination and remuneration committee | Every listed public company and a company covered under rule 4 of the Appointment Rules | As in the row above for rule 4 companies | As above | Sections 177(1), 178(1); Meetings Rules, rule 6 |
| Vigil mechanism | Every listed company; companies that accept deposits from the public; companies that have borrowed from banks and public financial institutions in excess of fifty crore rupees | As stated | Not printed in the rule | Meetings Rules, rule 7 |
| Internal auditor | Listed companies; unlisted public companies with paid-up capital of fifty crore rupees or more, turnover of two hundred crore rupees or more, loans from banks or public financial institutions exceeding one hundred crore rupees, or deposits of twenty five crore rupees or more; private companies with turnover of two hundred crore rupees or more or such loans exceeding one hundred crore rupees | As stated | The preceding financial year | Section 138; Accounts Rules, rule 13 |
| Secretarial audit | Listed companies; every public company with paid-up capital of fifty crore rupees or more or turnover of two hundred fifty crore rupees or more | As stated | Not printed in the rule | Section 204; Managerial Personnel Rules, rule 9, as notified in 2014 |
| Whole-time KMP | Every listed company and every other public company with paid-up capital of ten crore rupees or more | As stated | Not printed | Section 203; rule 8, as notified in 2014 |
| Cost records | Companies in the printed sectors with overall turnover of rupees thirty five crore or more | As stated; not for micro or small enterprises as the proviso says | The immediately preceding financial year | Section 148; Cost Records Rules, rule 3 |
| Cost audit | Regulated sectors: overall turnover rupees fifty crore or more and product turnover rupees twenty five crore or more; other specified sectors: rupees one hundred crore and rupees thirty five crore | As stated | The immediately preceding financial year | Section 148(2); rule 4 |
| Auditor rotation | Listed companies, and (excluding OPCs and small companies) unlisted public companies with paid-up capital of rupees ten crore or more, private companies with rupees fifty crore or more, and others with public borrowings from financial institutions and banks or public deposits of rupees fifty crores or more | An individual auditor for not more than one term of five consecutive years; an audit firm for not more than two such terms | Not printed | Section 139(2); Audit Rules, rule 5 |
| Deposits from the public ("eligible company") | A public company with net worth of not less than one hundred crore rupees or turnover of not less than five hundred crore rupees, with its general meeting resolution filed | As printed | Not printed | Section 76; Deposit Rules, rule 2(1)(e) |
| CARO 2020 | Applies to every company except a banking company, an insurance company, a Section 8 company, an OPC, a small company and a private company that meets the one crore rupees paid-up capital and reserves, one crore rupees borrowings and ten crore rupees revenue conditions and is not a subsidiary or holding company of a public company | As stated | Balance sheet date for capital; any point of the financial year for borrowings | CARO 2020, paragraph 1(2) |
Notes on the table
Small company. Section 2(85) as printed still shows fifty lakh rupees and two crore rupees with the statement that the prescribed higher amounts "shall not be more than" ten crore rupees and one hundred crore rupees. Rule 2(1)(t) fixes the prescribed amounts. The e-book prints the limits in the table and notes that they were substituted by the Companies (Specification of definition details) Amendment Rules, 2025 dated 1 December 2025; the older figures quoted in the note (two crores and twenty crores) are not law. Check the notification for the date from which the new limits apply.
Secretarial audit and KMP. The Managerial Personnel Rules thresholds above are the 2014 text as notified; later amendments, including to the rule 9 thresholds, should be checked.
Test dates. Where a rule says "last date of the latest audited financial statements" (rules 3 and 4 of the Appointment Rules) or "preceding financial year" (section 135(1), rule 13), that is the date to use. Where the text prints none, do not assume one.
For the CSR spending side, see our guide on CSR applicability, and for the company types behind these rows, types of companies defined in the Act. For a compliance review against these rows, see our compliance advisory service.
Companies that became small companies under the 2025 limits
The provisions below name small companies in their printed text. A company that falls under the new limits (and is not a public, holding, subsidiary, Section 8 or special Act company) should read each one; no other change is claimed here.
| Provision | What the printed text says about small companies |
|---|---|
| Section 2(40), proviso | The financial statement of an OPC, small company and dormant company may not include the cash flow statement |
| Section 92(1), provisos | The annual return of an OPC and small company is signed by the company secretary or, where there is none, the director; an abridged return may be prescribed. Form MGT-7A is the form for OPCs and small companies under rule 11(1) |
| Section 134(3A) and rule 8A | An abridged Board's report may be prescribed for an OPC or small company; rule 8A lists its items. See our board's report format for an OPC and small company |
| Section 173(5) | A small company is deemed to comply with the Board meeting frequency rule if there is a meeting in each half of the calendar year with a gap of not less than ninety days |
| Section 446B | Lesser penalties: not more than one-half of the penalty specified, up to the maximum printed |
| Auditor rotation, rule 5 | OPCs and small companies are excluded |
| CARO 2020, paragraph 1(2)(iv) | A small company is excluded |
| Cost records, rule 3 proviso | Micro and small enterprises under the MSMED Act are excluded: that is a different "small", not section 2(85) |
| Rule 9B demat | See our article on rule 9B and the 2025 limits for what that rule prints about small companies |
Worked example (invented figures)
Dahlia Packaging Private Limited has paid-up capital of Rs 8,00,00,000 and turnover in the last profit and loss account of Rs 70,00,00,000. It is a private company and neither a subsidiary nor a Section 8 company. Capital: 8 crore is not more than 10 crore. Turnover: 70 crore is not more than 100 crore. It is a small company under the 2025 limits (it would not have been under the older two crore and twenty crore figures). It now reads section 2(40), 92(1), 134(3A), 173(5) and 446B as above. It is outside CARO 2020 paragraph 1(2)(iv). If it were a subsidiary of another company, section 2(85) proviso (A) would exclude it.
Common mistakes
- Using the older two crore and twenty crore figures for a small company.
- Testing size on the wrong date.
- Applying a threshold to a company type the row does not name.
- Forgetting that the Managerial Personnel Rules thresholds are as notified in 2014.
- Treating the MSMED "small enterprise" as a section 2(85) small company.
Need help checking which rules apply?
We can map your company's size to each row, prepare the committee and audit appointments and bring the filings in order. See our compliance advisory service.
Key takeaways
- Small company limits in the e-book: ten crore rupees paid-up capital, one hundred crore rupees turnover.
- Each duty has its own threshold and test date; read the row for your company type.
- A public, holding, subsidiary or Section 8 company cannot be a small company.
- Managerial Personnel Rules thresholds are as notified in 2014.
- Provisions that name small companies are listed in the last table.
Read next
- Board's Report Format for a One Person Company and a Small Company
- Rule 9B Demat After the 2025 Small Company Limits
- One Person Company: Which Provisions Apply
- CSR Applicability Under Section 135
Disclaimer: Based on the Companies Act, 2013 in the Ministry of Corporate Affairs consolidated text (last updated 29 July 2022), the Rules as consolidated in the Ministry's e-book and the other official texts named in this article, as consulted on 3 October 2026. Later amendments, notifications, circulars, forms and fees should be checked. Formats are general drafts to be adapted to the company's articles and facts. This article is general information, not legal advice; check the official text before acting.