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Proprietorship Firm Registration

    Proprietorship Firm Registration in Delhi, India


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    Sole Proprietorship Firm Registration is the process of registering a firm in your name only. It means you are the one who is going to launch a business under your ownership. No one else will be your partner. In this situation, there will be no difference between the business and the owner. This type of business has the minimum amount of compliance and another requirement and the least registration fees.

    A Sole Proprietorship firm is not a legal entity that will be required to clear the debts of the business. It is one of the most popular forms of business and is very easy to register.

    It is a convenient and simple way to start your own business in India as it is considered a corporation or a company. Here, the business is owned by a single person who is the owner/shareholder of the proposed institution.

    There is no formal procedure for registering a sole firm; you can do other government registrations like MSME Registration or GST registration for proprietorship firm based on your business’s type and eligibility.

    Benefits of Proprietorship Firm Registration in Delhi

    Every business structure has its own benefits. Some of the specific benefits of a Sole Proprietorship Business are given below:-

    • Simple Business – Various shops in our local places doing small business are the Sole Proprietorships owned by a single person.
    • Easy to Start – Sole Proprietorships are not mandatory registrations according to law. You need licenses or registrations specific to the nature of a particular business. Therefore, any
      a person can start his/her business very easily.
    • Less Investment Required – This type of business needs minimal investment to start a business at the initial phase. It provides a great opportunity for that business firms that wish
      to set up a business with low investments.
    • Minimum Legal Compliances – Proprietorships firm registration in India is not mandatory; therefore, the legal compliances are minimal. You will not need a Certificate of Incorporation from the concerned authority. To make it easy, sole proprietorship complies with the GST return filing if it registers itself under GST law. Therefore, there is no such obligation to upload the Annual report on the Ministry of Corporate affairs site.
    • Minimum Income Tax – In this type of business, there is no need for separate tax. Sole Proprietorship is meant to be the same for the purpose of calculation of tax liability. The assets & liabilities of the Sole Proprietorship are their assets and liabilities. According to Income Tax Act, the sole proprietor have to file IT returns and must show the profits earned in the business.
    • No Requirement for Audit – It is not mandatory to get the business accounts audited every year according to the law. However, the audit will depend upon your business and the threshold turnover limits specified for conducting the audit for a firm.

    Documents Required for Sole Proprietorship Firm Registration in India

    • Aadhar Card – It is mandatory for applying for Proprietorship registration in India. Also, income tax returns can be filed when your PAN card is linked with an Aadhar number.
    • PAN Card – Again, you can’t file your income tax return without PAN. So if you don’t have a PAN number, apply for it at the earliest. PAN card can be applied online and it costs Rs. 110.
    • Bank Account – After you have linked your Aadhar Number and PAN, you open your account if you haven’t. For opening a current account, you will need a GST registration document.
    • Registered Office Proof –
      1. If your business is in a Rented Property: Rent agreement and NOC from a landlord.
      2. If your business is a Self-owned Property: Water bill or any other address proof.

    Registration Required for Sole Proprietorship

    In addition to the above documents, here are some other documents required to establish the existence of the firm:

    Registering as SME

    You can get your business registered as a Small and Medium Enterprise that comes under the MSME Act. It is not mandatory to register a business as an SME, but it is highly beneficial, especially when taking a loan for the business.

    Shop and Establishment Act License

    It isn’t mandatory in every state in India, but it is required to be obtained according to the local laws. This license is issued by the municipal corporation of the State. It is given on the basis of the number of employees.

    GST Registration

    Register your business under GST if your annual turnover is more than Rs. 40 lakhs. Also, online businesses are required to get a GST number. For GST registration for proprietorship firm, you need the following documents –

      • PAN card
      • Photo
      • Aadhar Card of the proprietor
      • Proof of business place (Electricity bill/ rent agreement)
      • Bank statement copy

    Step 1: Getting PAN card

    You will need to apply for Permanent Account Number or PAN from the government in case you don’t have a PAN card to be able to run your business.

    Step 2: Decide name for your business

    You should choose a name for your entity which clearly defines the purpose of your business. The name must also be unique and not in use by any other business.

    Step 3: Current bank account and entity registration

    After deciding name for your business, you will need a current bank account in the name of your business entity. Since, no formal registration is needed, you can go for other government licenses according to the legal requirements of your business.

    Step 4: Registration under MSME

    Although it is not necessary, you can go for MSME Registration or SME Registration under the Micro, Small and Medium Enterprises Development Act of 2006. Getting registered under the MSMED Act can help you take benefits from the government schemes for such enterprises.

    Step 5: Getting GST Registration

    You can also get GST Registration if the turnover of your business exceeds the limit for the same in your respective state.

    Why Choose TaxOnTrack?

    TaxonTrack provides access to expert professionals and coordinates with them to fulfill all your proprietorship firm registration online requirements. You can also track the progress on our online platform at all times by talking to our experts. Give us a call today and register your sole firm at a minimal cost. Proprietorship firm registration fees of Taxontracks are also very affordable.