Sole Proprietorship Registration
Today in this article will explain you about the Sole proprietorship Registration in India.
What is Sole Proprietorship?
A sole proprietorship is a company or a business that is run by one person. It is managed and owned by one single person, which makes it easier to keep an eye on. You do not need to go through any particular registration to start your business because these kinds of business are recognized by other sorts of registrations, mainly tax and sales.
It only takes around 15 days to start up your sole proprietorship which is a huge benefit for you and your business because this way, it will be fresh and new real quick. It sounds great, does it not?
However, just like all the too good things, this too has some drawbacks. For instance, businesses like this may not be very consistent and long-lasting. Even then, it is a very likely chance that yours may just work out to be fine. Let’s discuss some of the benefits of a sole proprietorship.
How to register Sole Proprietorship online
Sole Proprietorship registration online is completely a digital process and hence you can register your business without leaving your chair. Generally, a person desirous to establish and profess the business as a sole proprietorship requires starting with certain basic requirements such as one need to have a Current Bank Account on the Name of Business to support the ease of doing business. Starting a business as a Sole proprietorship is easy in India with less Compliance and less Costing.
Sole proprietorship registration is required for the individual owned business and India is toward ease of doing business, hence it is suggested to obtain the given below registrations to make his business function smoothly and legally. You can select any of registration from the below-
- 1. Shop and Establishment Registration under the prescribed law
- 2. SME Registration
- 3. GST Registration
Documents Required for Sole Proprietorship Registration
To register a sole proprietorship governed by any specific laws it has minimal and easy compliance.
Following documents are required for sole proprietorship registration -
- Aadhar Card
- Registered Office
- PAN Card
- Personal Bank Account
Rules and Regulations under Sole proprietorship Registration
In India, a sole proprietorship registration is governed under GST act, MSME Act and Shops and Establishment act.
Features of Sole Proprietorship Registration
The following are the features of sole proprietorship registration –
- No sharing
- Individual capital
- One Ownership
- Unlimited liability
All earned income goes in the pocket of the real owner. No sharing of profit and loss is there in a sole proprietorship.
To start the business or to even continue the business capital is must and it is solely invested by the sole proprietorship from his income or borrowing.
Only the owner has the true ownership in his hand of the business. The assets and the liabilities lie in the hand of the owner.
Now, when there is no sharing profit then it also implied at the time of liability rise. The owner will be only liable to pay the liability in case of any loss.
What are the advantages of Sole Proprietorship Registration?
Just like all the businesses, sole proprietorship also has a few benefits. I mean, you can imagine how awesome it would be to run a successful business with only your name on it. Here are a few other benefits of this amazing business type.
- Considerably Less Expensive
- Easy to Start
- Minimum Compliance
A sole proprietorship is not like One Person Company. So if you compare the two, you can see that proprietorship is a lot inexpensive than OPC. This sort of a business is not only inexpensive in the beginning only but also in the long run. For example, in a business like a proprietorship, you will not have to hire many people like an auditor. Hiring fewer people will automatically allow you to spend less money.
You don’t need to have any particular registration for the company itself. You would either need a Service Tax Registration or a Sales Tax Registration. Both of these would hardly take 15 and 45 days respectively. Apart from this, the process is fairly simple. All you would need for the creating on your business is a PAN card and identity & address proof.
The sole proprietorship is a business where you would only have to answer your government or tax registrations because only they will recognize you. This way you would only have to file your compliance annually.
Compliances after Sole Proprietorship firm Registration
- Comply to GST Registration rules and regulation for Sole Proprietor
- Avail MSME Registration benefits
- Carefully use HAC/SAC Code during GST Registration
- Subscribe Corpbiz services for GST Return filing Monthly / Quarterly
- Club your all business and other income in your Personal income tax return