Sole Proprietorship Registration - An Overview
Sole Proprietorship Registration Process:
GST is a multi-stage tax, charged at every point of sale. It has replaced many indirect taxes such as the service tax, Value Added Tax (VAT), central sales tax, excise duty, additional customs duty, and so on. A GST registration makes a business legally recognized.
Any person/business making inter-state supply of goods & services and having an annual turnover of over 20 lakhs (40 lakhs in certain states) is mandated to have GST registration. GST registration is mandatory for certain types of businesses.
MSME registration or otherwise known as Udyam registration is provided to the micro, small, and medium-sized businesses in India that comes under the Micro, Small, and Medium Enterprise Development Act, 2006 (MSMED). It is one of the most important certificates as it helps in gaining the advantage of government schemes.
Assistance in opening a current account at the preferred bank will be provided, thereby opening the bank account will be at ease.
Frequently Asked Question
Any Indian Citizen can start a Sole Proprietorship concern in India.
No. The proprietorship firm and the proprietor are one and the same legally. The PAN of the proprietor will be the PAN of the firm. All assets and debts of the business in the proprietorship are owned by the proprietor and no the firm.
No. As proprietorship concern does not have a separate entity status, it cannot obtain a separate PAN. So, the Individual Proprietor’s PAN will be the PAN of the Proprietorship concern too.
No. There is no specific requirement for a proprietorship to get registered. However, to get legally recognized, the proprietorship can obtain registrations related to business operations such as GST Registration, MSME Registration, Shop Establishment Registration etc.
Yes. One individual can operate more than one proprietorship concern. There is no upper limit.
It is not necessary for proprietorships to prepare audited financial statements each year. However, a tax audit may be necessary based on turnover and other criteria.
There is no annual reports or accounts that needs to be files with Ministry of Corporate Affairs like that of a Company or an LLP. However, an annual Income Tax Return with Income Tax Department would be needed.
An OPC has limited liability which means the owner’s responsibility is limited to the capital contributed and in case of a future loss, his personal assets are safe.
Apart from that Sole proprietorship is usually preferred over OPC because of less regulations and ease of Formation.