Sole Proprietorship Registration
– Ease of Setup
– Full Control
– Direct Profits
– Tax Advantages
– Flexibility
– Privacy
– Low Costs
For Expert Consultancy
Get in Touch
Sole Proprietorship
In India, a sole proprietorship can be a simple and convenient way to start a business. It is neither considered as a corporation nor a company where the business is owned by a single person who is the owner/director/shareholder of the proposed entity.
Shops such as chemists, saloons and grocery stores are examples of common proprietorship businesses.
What is an Sole Proprietorship?
The sole proprietor is a living person who owns a sole proprietorship. He must also be an Indian national and a resident. A sole proprietor is entitled to all profits made by the business and is personally responsible for all losses.
The Basic Requirements for the Registration of a Sole Proprietorship and the Options Available
A sole proprietorship can be registered digitally with an expert’s help. To register as a sole ownership, an individual must meet certain requirements, such as opening a business bank account.
- Sole Proprietorship registration through Udyog Aadhaar in the Ministry of MSME
- Registration of sole proprietorship under the Shop and Establishment Act
- GST registration for sole proprietorship
What is the compliance required?
As a sole owner, you are required to file Annual Income Tax Return. You must also file your GST return if you have registered for GST. If a sole proprietor is subject to a Tax Audit, they should deduct TDS from their income and file a TDS Return.
The Benefits of a Sole Proprietorship
What you need to know about compliance
Less Compliances
All Private Limited Companies in India are required to register for GST within 30 days after incorporation. When the turnover exceeds 40 lakhs INR or INR 20 lakhs for Special Category States, or if the business provides goods or services intra-state, or if it is online.
Controlling the business
He will be in total control of the business. He will be in charge of all aspects of the company. Secrecy is possible because only one person runs the business.
Quick decision making
All business decisions are made by the sole proprietor. One person is responsible for all decisions. So, decisions can be made quickly and without consulting anyone.
Tax benefits
A sole proprietorship owner is not required by law to file a separate tax report. Tax rates for the business are the same as those that apply to personal income and not corporate rates. It means massive tax savings.
Self Employment
Proprietorship firms are self-employed, and the owner is a freelancer. This creates a variety of employment opportunities. There are also fewer leakage risks because the sole owner controls the business.
Inexpensive
The cost of registering as a sole proprietorship is low compared to other types of organization. It is also an advantage because of the minimal compliance requirements.
Documents required for a sole proprietorship
registration
Aadhar Card
PAN (Permanent Account Number) card
Bank account number
Registered office proof
How to Register a Sole Proprietorship
1. Select the name of your sole proprietorship
In order to register a sole proprietorship, the first step is to choose a name that is unique. The name of a sole proprietorship cannot violate any Indian intellectual property laws. The name of the sole proprietorship must not offend.
2. Choose location for your business activities
The sole proprietor must select the location of their business in the next step. It is important that the sole proprietor registers with the appropriate authority. This authority includes the Shops and Establishments Act and relevant government authorities.
3. Register with the MSME
According to the MSMED Act of 2006, a sole-trader or sole-proprietor is required to be registered under the MSMED in order to conduct activities. The MSMED Act, 2006 requires a sole trader or sole proprietor to register under the MSMED in order to carry out activities. MSME (Micro, Small and Medium Enterprises Registration) Or such Udyog Aadhaar registration The sole trader can secure the loan in his name. The MSMED Act requires that this be done.
4. Register for GST
According to the Goods and Services Tax Act of 2017, traders must register if their business turnover exceeds a certain amount. The turnover would be the annual business revenue. If the annual turnover of a service entity exceeds Rs. 20Lakh GST registration will be required If the annual turnover of a trading company exceeds Rs. 40Lakh
5. IEC Registration (Import- Export Code Registration)
If the sole trader exports goods out of India, the business must register with the IEC. The registration must be submitted to the Director of Foreign Trade. If the sole trader does not conduct any import or export business, this license is not required.
6. Register with the FSSAI
FSSAI registration This license is only required if the business carries out activities related to packaging or making food products. The license is also required for sole traders who handle food products. The proprietor will need to apply for a license with the relevant authority, i.e. The FSSAI is the Food Safety and Standard Authority of India.
7. Secure the TAN
It is important to obtain the Tax Deduction Account Number from the relevant Income Tax Authority. The sole proprietor would need to do this if they are making salary payments. TDS System (Tax deducted at source). In the case of sole proprietorships, this would be only required for salary payments.
FAQs of Sole Proprietorship Registration
Who will start a sole proprietorship?
A sole proprietorship can be started by any Indian citizen with a bank account under the business name. Registration may or may not be required, depending on what kind of business is planned. To open a current bank account, the banks will need to have a Shops and Establishments Registration.
How long does it take to set up a sole proprietorship business?
It takes less than 15 days to start a sole proprietorship. Its simplicity is why it’s so popular among small merchants and traders. Of course, it is also cheaper. It is for this reason that it is most commonly used as a business structure.
What type of business is run by a sole proprietorship?
In general, local businesses, including grocery stores, fast-food outlets, small traders, and manufacturers, are operated by sole proprietors. It’s not that large businesses can’t be sole proprietorships. They certainly can! Jewelry retailers can be sole proprietors. However, it is not recommended.
What should I do if I want to change from a sole proprietorship to a private limited company or partnership?
It’s possible that the procedure could be very tedious. At a later stage in their business, it’s not uncommon for sole proprietors or small businesses to become partnerships or private limited corporations.
Can a sole owner hire employees?
Employees can be hired by sole proprietors. Employees and workers are essential to the success of small businesses and MSMEs. The number of workers that a MSME can employ is not limited.
Can FDI in a proprietorship be allowed?
Yes, Foreign Direct Investment in sole traders is permitted. There are certain conditions that must be met to receive foreign direct investment as a sole proprietorship.
Can a sole proprietorship change its name?
The name of a sole proprietorship can be changed. Public and government announcements are required to inform the public of any name change. The sole trader must also inform the parties concerned about the name change.
Can a sole proprietorship have any name?
As long as the name is not offensive, it can be used as the sole proprietorship.
Our clients say
While perfection is a pursuit, the expertise and commitment provided by this firm in handling GST and financial services are exceptional. Their attention to detail and client care truly set them apart
ForExchain
Travel Agency
The dedication and professionalism shown in managing my GST and financial services have been outstanding. Their thorough approach and reliable support make them an invaluable partner for any business
OMNI Mart
E-commerce
Absolutely good in providing audit services, with thorough attention to detail and a deep understanding of financial processes. Their professionalism, accuracy, and client-focused approach make them a reliable partner for all auditing needs
Yajurvid Pharma
ManufacturerÂ
Their proactive approach ensures that we consistently improve and evolve together for better results. There’s always room for growth, the continuous dedication to enhancing our services reflects a strong commitment to client satisfaction.
Royal Renewable Energy
Energy
Almost Perfect, The team has done a fantastic job handling my Audit and financial needs. There’s just a small bit of potential for improvement, but overall, the service is outstanding and highly dependable
Aurasun
Energy
Strongly Recommend, Their professionalism and deep knowledge of Aduit, Accounting and financial services set them apart. While I can confidently say I’m very satisfied, I believe a touch more flexibility would make them truly unbeatable
Naira Constructions
Construction
Truly impressive in every aspect, from their expertise in Audit and financial accounting services to their consistent professionalism. Their ability to deliver quality solutions speaks volumes about their commitment to excellence
Travelin
Travel Agency
By officevksharma