Proprietorship

GST Registration

INR 2899 All Inclusive

INR 6988 All Inclusive

Proprietorship Registration

A sole proprietorship is one of the simplest and most time-honored business structures in India. As a sole proprietorship is owned, managed, and controlled by a single individual – the proprietor – it offers a streamlined and efficient way to start a business with minimal compliance requirements.

In this structure, the proprietor and the business are considered one and the same, meaning there are no partners or shareholders involved. This also implies that the proprietor assumes unlimited liability for the business’s activities. Due to its straightforward nature, a sole proprietorship is well-suited for small enterprises with a limited team of up to five employees.

At Allycon, we provide expert assistance in registering your sole proprietorship. Our streamlined process and professional guidance make it easy for solo entrepreneurs to establish their business online quickly and hassle-free. Start your sole proprietorship registration with Allycon and unlock the potential of your business ideas.

Proprietorship Registration in India

In India, registering a sole proprietorship follows a distinct process since there is no dedicated government registration specifically for this business structure. Instead, recognition for a proprietorship is typically achieved through tax registrations as mandated by relevant laws and regulations. One crucial tax registration is the GST (Goods and Services Tax) Registration. This registration, obtained in the proprietor’s name, formalizes the business’s status as a proprietorship. It serves as an official acknowledgment that the proprietor is conducting business under this structure.

At Allycon, we guide you through this unique registration process, ensuring that you meet all necessary tax requirements to establish your proprietorship effectively. Our expert team makes it easy to navigate the registration process and start your business with confidence.

Essential Licenses and Registrations for Proprietorships

To run a proprietorship in India, you need important licenses and registrations, including:

  • Get a Permanent Account Number (PAN) and an Aadhaar card for your business identification.
  • Register under UDYAM, which recognizes your business as a Micro, Small, or Medium Enterprise (MSME) and offers government benefits.
  • If your business exceeds specific thresholds, you must register for Goods and Services Tax (GST) to collect and pay GST.
  • Open a separate bank account for your business to manage finances smoothly.
  • Depending on your business location, register under your state’s Shops and Establishment Act to follow local labor regulations.

Advantages of Proprietorship

  • Easy Registration: Sole proprietorships do not require formal incorporation or dissolution processes. However, to operate legally, the proprietor may need to obtain certain registrations and licenses in compliance with Indian laws and regulations.

  • Lower Compliance: With most proprietorships only needing registration with government departments such as Income Tax and GST, the compliance burden is lower compared to entities like LLPs or Companies, which are regulated by the Ministry of Corporate Affairs and face additional statutory requirements and audits.

  • Simplicity: Operating without partners, shareholders, or directors, the proprietor can manage the business with minimal documentation and consent requirements. This makes it ideal for very small businesses.

  • Business Decision: The proprietor has full authority to make all business decisions without needing consent from others, enabling quick decision-making.

  • Complete Control: As the sole owner, the proprietor has total control over assets, revenue, expenses, and all business operations.

Disadvantages of Sole Proprietorship

  • Funding: Sole proprietorships depend solely on the proprietor’s savings, borrowings, and credit history. Raising funds from banks can be challenging, and equity funding is not possible since the structure does not support profit sharing or shareholding.

  • Personal Liability: The proprietor is personally liable for business debts and obligations. Personal assets may be at risk if the business cannot meet its financial commitments.

  • Business Continuity: The sole proprietorship will automatically dissolve in the event of the proprietor’s death or disability, affecting business continuity.

  • Growth Constraints: Due to limitations in funding, liability, and continuity, sole proprietorships are generally suitable for small, unorganized sector businesses.

  • Unincorporated Business: Being an unincorporated entity, there is no centralized database to verify the status of a sole proprietorship, often classifying it as an unorganized business.

Registering a Proprietorship Online through IndiaFilings

Registering a sole proprietorship online is straightforward with Allycon. We offer a streamlined process that typically requires only the PAN and Aadhaar card of the proprietor. Here’s how we can assist:

  • GST Registration: We help secure GST registration, essential for formalizing your business’s proprietorship status.

  • Zero-Balance Business Current Account: Open a current account with LEDGERS Accounting Software, available through our service.

Steps for Online Registration:

  1. Login: Access LEDGERS using your email for payment.
  2. Select Service: Go to the Services Tab and choose Proprietorship Engagement.
  3. Upload Documents: Provide your PAN and Aadhaar card copies.
  4. Application Filing: An Allycon expert will file your registration with the GST Department and the bank for your current account.
  5. Access LEDGERS: Use the accounting software for GST invoicing, filing, and other services.

 

PAN Card for Proprietorship Firm Registration

A proprietorship does not have a separate PAN card. The PAN card of the proprietor is used for the business.

Obtaining GST Registration for Proprietorship

IndiaFilings will handle GST registration for your proprietorship. Required documents include:

  • PAN card of the proprietor
  • Digital Signature Certificate of the Authorized Signatory
  • Consent from the proprietor
  • Photographs of the proprietor and authorized signatory
  • Bank Account Details
  • Rent/Lease Agreement (if applicable)
  • Additional identification documents, if necessary

Obtaining Shops & Establishment Act License for Proprietorship

After securing GST registration, we assist in obtaining UDYAM registration to access benefits for small and medium-sized businesses.

Required Documents for GST Registration:

  • PAN card of the proprietor
  • Aadhaar card, passport, driving license, or voter ID
  • Proof of business address (e.g., electricity bill, rent/lease agreement)
  • Consent for GST registration
  • Bank account details (cancelled cheque)

Once registered, you can access our tools and services for managing your business finances, including GST filing and compliance management.

Compliances for Proprietorships:

  • Income Tax Filing: The proprietor must file personal income tax returns using ITR-3 or ITR-4, declaring business income.
  • GST Return Filing: Monthly or quarterly GST returns are mandatory for businesses registered under GST.
  • TDS Returns: If the business has employees or high-value transactions, TDS returns must be filed quarterly.

Allycon ensures you stay compliant with these requirements, helping your business operate smoothly.

Related Business Registrations

In addition to registration or incorporation, a business may require other registrations depending on the business activity undertaken. Talk to an Advisor to find out registrations your business may require post registration.