Sole Proprietorship Firm Registration
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WHAT IS SOLE PROPRIETORSHIP REGISTRATION?
When single person runs a business then such kind of business is called as proprietary business, and the owner of the business is called as proprietor. Proprietorship is the most common form of the business which is used in India. You can start and operate the business with minimum regulatory compliance. However there is no full fledged way available to register your proprietorship by Indian Government. Tax registration and other business registration’s is the right way to show existence of your proprietary business
Following registrations can be used to show the existence of your proprietory Business
- Professional Tax Registration.
- GST Registration.
- Shop and Establishment Registration.
The owner of a sole proprietorship business typically signs contracts in his or her own name, because the sole proprietorship business has no separate identity under the law. The sole proprietor owner will typically have customers write checks in the owner’s name, even if the business uses a fictitious name. Sole proprietor owners can, and often do, mix personal and business property and funds, something that partnerships, LLCs and corporations cannot do. Sole proprietorships often have their bank accounts in the name of the owner. Sole proprietors need not observe formalities such as voting and meetings associated with the more complex business forms. Sole proprietorship can bring lawsuits (and can be sued) using the name of the sole proprietor owner.
DOCUMENTS REQUIRED FOR PROPRIETORSHIP FIRM REGISTRATION
To register a sole Proprietorship, minimum documents are required which are :
- Aadhar card or any identity proof
- Self PAN card
- Business account (Current account)
- Address Proof (Rent Agreement, Electricity Bill)
CURRENT ACCOUNT OPENING
A current account is a type of deposit account that helps the professionals and businessmen to run their business. Businessmen can avail various benefits by Online Current Account such as:
- Unlimited transactions
- Customized features
- Online banking services
Online current account reduces the hassle and provides the benefit to complete the banking process anytime and anywhere.
ENTITY COMPARISON GUIDE
|Members||Maximum 1||2-20||2- Unlimited||2-200||1|
|Legal Status of Entity||Not Considered as separate Legal entity||Not Considered as separate Legal entity||Considered as separate Legal entity||Considered as separate Legal entity||Considered as separate Legal entity|
|Members Liability||Unlimited Liability||Unlimited Liability||Liability of its members is limited||Limited to the extent of share capital||Limited to the extent of share capital|
|Registration||Not Compulsory||Optional/ Can be Registered under partnership Act 1932||Registered Under MCA||Registered Under MCA||Registered Under MCA and Companies Act 2013|
|Transferability Option||Not Allowed||Not Allowed||Can Be Transferred||Can Be Transferred||Allowed to only one person|
|Taxation||As in Individual||30% of Company Profit||30% of Profit Plus CESS and Surcharges applicable||30% of Profit Plus CESS and Surcharges applicable||30% of Profit Plus CESS and Surcharges applicable|
|Annual Filings||Income Tax Returns with the Registrar of companies||Income Tax Returns with the Registrar of companies||Filed with the registrar of the company||Filed with the registrar of the company||Filed with the registrar of the company|
ADVANTAGES OF SOLE PROPRIETORSHIP REGISTRATION
- Easy To Start and Close Business:
One a week’s time you can start your business saving your time and money.
- Single Ownership:
Single ownership means less complications, also decision making is limited to one person.
- No Restriction For Business Name:
There is no need to register or reserve the name for proprietorship purpose, you can directly start the business on any name of your choice.
- Easy Closure:
Closure procedure is very simple with minimum formalities.
COMPLIANCES REQUIRED FOR SOLE PROPRIETORSHIP FIRM REGISTRATION
Sole Proprietorship has minimal compliances as it is not a separate legal entity from a proprietor. Main compliances are tax related and annual compliances.
Following are the compliances a sole proprietorship india needs to follow:
1. Sales Tax (VAT) Returns:
These are to be filed in every quarter of the assessment financial year, on the following prescribed dates
- For April to June – July 25
- For July to September – October 25
- For October to December – January 25
- For January to March – April 25
2. Service Tax Returns:
These are filed on half yearly basis, on the following due dates of the assessment financial year
- For April to September – October 25
- For October to March – April 25
3. Income Tax Returns:
ITR is filed on yearly basis, on the following dates depending upon the necessity of financial/tax audit
- When audit is not necessary under any law – July 31 of the assessment financial year
- When audit is compulsory under any law — September 30 of the assessment financial year. This gets applied when the annual turnover of the proprietorship firm is over INR One Crore; Or the Service Turnover is more than INR 25 Lac.
SOLE PROPRIETORSHIP REGISTRATION FAQS
The sole proprietorship firm is the simplest type of business under which one can operate a business. The sole proprietorship is not a legal entity. It simply refers to a person who owns the business and is personally responsible for its debts.
You can register a Proprietorship firm just by following the steps mentioned below:
Visit TaxOnTime.in Website
Fill up a simple form on our website providing basic information about proprietor and business.
Provide relevant documents online and we will file them with relevant authorities.
Send Detail by Enquiry Form
When single person runs a business then such kind of business is called as proprietary business, and the owner of the business is called as proprietor.