Proprietorship Registration Services

A sole proprietorship is one of the most commonly registered business structures in India. Unlike other businesses, sole proprietorship registration has minimal formalities and is one of the cost-effective ways to register your business.

The term sole proprietor clearly indicates that the type of business is a single-person-owned business structure. It is found and managed by a single person. Even though proprietorship firm registration is not mandatory in all cases, registration will offer your business a host of benefits including easier access to financial support and also help you improve the credibility of your firm.

In a sole proprietorship firm, where a single person owns and manages everything, he (as a proprietor) will have all the control over decision-making and the operations of the business.

So if you run a business, and are looking forward to building a presence, then registering your proprietorship firm will be the ideal and strategic move. Registering your business operations opens doors to various growth opportunities.

Features of sole proprietorship

Registering your business as a sole proprietorship offers you a range of features that integrate operations, and position your business for success. Here are few important features of sole proprietorship firm:

Our Services

We offer you full assistance to successfully register your business as a sole proprietorship. We provide you with services that focus on delivering you a precise and reliable solution, addressing all legal and procedural requirements to establish your proprietorship smoothly.

Our service offerings for sole proprietorship registration include:

• Preparation and verification of necessary business registration documents, including PAN and Aadhaar linking.
• Assistance in obtaining GST registration for your business if your business exceeds the prescribed turnover limits or seeking voluntary registration.
• Guidance on Udyam (MSME) registration to access government schemes and benefits.
• Support in registering under the Shop and Establishment Act for businesses with physical operations, ensuring compliance with local labour laws.
• Preparation and submission of applications for business bank account setup in the name of the proprietorship.
• Advisory on obtaining additional licenses, including Professional Tax Registration and other state-specific permits.
• End-to-end support in securing a unique and compliant business name for the proprietorship.
• Compliance tracking and periodic updates on registration requirements as per evolving regulations.
• Document review services to ensure error-free submissions and quick approvals from relevant authorities.

Is forming a sole proprietorship firm right for your business?

A sole proprietorship firm is an ideal choice if you are looking for a business structure with autonomy and simplicity. Under this structure, you make all the decisions and retain all profits. If you are a freelancer, consultant, or small business owner seeking a straightforward and cost-effective way to operate, a sole proprietorship firm will be the right choice.

Not just that, a proprietorship firm is an attractive option for startups with limited capital. It involves less initial set-up costs and paperwork. For entrepreneurs seeking smooth operations and are good at decision-making, a sole proprietorship may be the ideal choice.

Different methods to register Sole Proprietorship

While a sole proprietorship does not require formal registration under any specific law in India, there are a few indirect ways to establish the existence of your business and gain additional benefits:

Advantages of a sole proprietorship firm

Registering a sole proprietorship firm offers a host of benefits, making it a compelling choice for entrepreneurs wanting to make his or her own decisions, and seeking operational ease. Here is an overview on a few advantages of proprietorship registration.

Challenges of a sole proprietorship firm

While a sole proprietorship offers numerous advantages, it is essential to acknowledge the potential challenges to make informed decisions for your business:

• Have to face unlimited liability where your personal assets won’t have protection from potential liabilities of your business.
• Raising capital can be challenging compared to other business structures, as you depend primarily on personal savings or loans.
• The weight of all business decisions and operations rests solely on your shoulders.
• In the event of the proprietor's incapacity or death, the future of the business becomes uncertain.

Documents required for registration

For a smooth and efficient sole proprietorship registration process, it is important to have all the necessary documents in order. Here is a list of essential documents you need to register your business as a proprietorship:

List of identity and address proof required

• PAN Card
• Aadhaar Card
• Passport
• Voter ID
• Driving Licence
• Bank Statement or Passbook (latest 3 months)
• Utility Bill (electricity, water, gas, etc.) (latest 3 months)
• Business Proof

If operating from owned property:

• Property ownership documents (sale deed, lease agreement, etc.)
• NOC (No Objection Certificate) from the property owner (if applicable)

If operating from rented property:

• Rental agreement
• NOC from the landlord

Documents based on the registration

1. GST registration
   • PAN Card of the Proprietor
   • Proof of business address
   • Bank account details
   • Authorised signatory details
2. MSME registration
   • Aadhaar number
   • PAN Card
   • Bank account details
   • Business activity details
   • Investment and turnover details
3. Other registrations
   • Depending on the nature of your business, you might have to submit additional documents for specific licences or permits.

Our team will provide you with a customised checklist made to your specific needs and guide you through the document preparation process. We'll ensure your application is complete and accurate, minimising delays and facilitating a quick registration.

Sole proprietorship firm registration process

Registering your business as a proprietorship firm requires proper understanding of the application procedure. Here is the step-by-step procedure required to register and incorporate proprietorships in India.

Step 1: Obtaining the necessary identification

• PAN card: Get a Permanent Account Number (PAN) for the proprietor, which serves as the tax identification number for your business.
• Aadhaar card: Ensure the proprietor possesses a valid Aadhaar card

Step 2: Finalise the business name

Select a nice, distinctive name for your proprietorship firm that adheres to legal guidelines and isn't already trademarked.

Step 3: Open a bank account

Open a current account in the name of your proprietorship firm. This helps in transparent financial transactions and separates personal and business finances.

In India you can register your sole proprietorship using three methods:

1. Through Udyam registration under the Ministry of MSME
2. Through the Shop and Establishment Act
3. Through GST registration

Now let's look at each method in detail.

Udyam registration (MSME)

• Visit the Udyam registration portal.
• Provide details about your business, including its name, address, investment, and activities.
• Link the proprietor's Aadhaar and PAN to the application.
• Upon successful verification, you'll receive a unique Udyam Registration Number.

GST Registration

• Go to the official GST portal.
• Register on the portal and provide necessary business details.
• Fill out the GST registration application, providing all the required information about your turnover, business activities, and bank account.
• Once the verification is done, you'll be assigned a Goods and Services Tax Identification Number (GSTIN).

Shop and Establishment Act Registration

• Go to the labour department website of your respective state.
• Complete the application form and submit it along with the required documents and fees to the designated authority.
• Upon successful verification, you'll receive a Shop and Establishment Act Registration Certificate.

Other possible registrations as applicable

• Trademark Registration: If your business has a unique logo or a name then you can protect it through a trademark registration.
• Professional Licences: Depending on your business activities, you may need to obtain specific licences or permits.

Timeline for sole proprietorship registration

Even though sole proprietorship registrations do not require a dedicated registration process, indirect methods like MSME or GST registration generally take a short time to complete. Obtaining your MSME registration can take anywhere between 2-4 working days, giving you quick access to government benefits. While GST registration typically takes 7-10 working days, it ensures compliance and increases your business' credibility.

Checklist to register your proprietorship

The following checklist outlines the essential steps involved in the proprietorship registration process in India:

• Obtain a PAN card and an Aadhaar card for the proprietor.
• Choose a unique and legally compliant name for your firm.
• Clearly identify the nature of your business operations.
• Open a current account in the name of your proprietorship.
• Consider Indirect Registrations:
• If your turnover exceeds the threshold, apply for GST.
• Register under Udyam to access government benefits.
• Register under Shop & Establishment Act if operating a physical shop or establishment.

Post-registration compliance

Registering your sole proprietorship is just the initial step. To ensure smooth operations and avoid any sort of legal complications, it is essential to follow some post-registration compliance requirements:

Tax obligations to follow

• Filing Income Tax Return: File your Income Tax Return (ITR) annually, even if your income is below the taxable limit. The appropriate ITR form (ITR-3 or ITR-4) depends on your business activities.
• GST Return Filing: If your proprietorship is registered for GST, then you have to file monthly or quarterly returns, depending on your turnover and the scheme you have chosen.
• TDS Compliance: Deduct TDS (Tax Deducted at Source) on applicable payments and file TDS returns quarterly.

Other Compliance:

• Maintain proper books of accounts: Keep accurate and up-to-date records of your business transactions, including income, expenses, assets, and liabilities.
• Shop and Establishment Act Compliance: Follow the rules and regulations outlined in the Shop and Establishment Act of your state, including working hours, employee benefits, and safety standards.
• MSME Compliance: If your proprietorship is registered as an MSME, you have to comply with any reporting or documentation requirements under the Udyam Registration.

Sole proprietorship Vs OPC

Bottom line

The success of your proprietorship firm starts with registration. As a solo entrepreneur, we understand your unique needs. Our experts will guide you through the registration process, simplifying it and ensure compliance.

FAQs

How to register a Sole Proprietorship under the Shop & Establishment Act?

Registering your sole proprietorship under the Shop & Establishment Act involves submitting an application form, along with required documents and fees, to the designated authority in your state.

How to register a Sole Proprietorship through Udyog Aadhaar under MSME?

Registering your sole proprietorship as an MSME through Udyam Registration (formerly Udyog Aadhaar) is simple. Visit the official Udyam Registration portal, provide your business details and the proprietor's Aadhaar and PAN, and complete the online application.

How to get GST for a Sole Proprietorship?

If your annual turnover exceeds the threshold limit, GST registration is compulsory. Apply through the GST portal, providing details about your business, turnover, and bank account.

Do I need to register my sole proprietorship if my turnover is below the GST threshold?

While not mandatory, registering your sole proprietorship, even with a turnover below the GST threshold, can offer benefits such as enhanced credibility and access to government schemes.