|Will I get a registration certificate for my Proprietorship concern|
Sole Proprietorship is the easiest form of business as there is no government registration needed in order to start a sole proprietorship business in India. As there is no specific law applicable on the sole proprietorship it’s easy to operate and compliance are minimal. You will be needed few documents to open a bank account, at least two documents as proof of business located in the form of government registrations such as shop act license, MSME (Udyog Aadhaar) and GST registration.
Proprietorship businesses are considered to be one and the same as the Proprietor. The PAN card of the proprietor will be used for the opening bank account, obtaining licenses/registrations/ certificates in the name of the sole proprietorship and filing an income tax return for the sole proprietorship. Hence, obtaining PAN card for the Proprietor is the first step in establishing a sole proprietorship.
To start a business in proprietorship and get it to register as a Sole Proprietorship, the following documents are required:
- PAN Card
- Aadhaar Card
- Bank Account
- Registered office proof
Although sole proprietor does not require any specific registrations, he is advised to obtain a few registrations to make his business function smoothly.
- MSME (Udyog Aadhaar)
- Shop and Establishment
- GST registration
The Government of India has enacted the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 in terms of which the definition of micro, small and medium enterprises is as under:
- Enterprises engaged in the services and manufacture or production, processing or preservation of goods as specified below:
- A micro enterprise is an enterprise where investment in plant and machinery does not exceed Rs. 1 Crore and Turnover not exceed 5 crore.
- A small enterprise is an enterprise where the investment in plant and machinery does not exceed Rs. 10 Crore and Turnover not exceed 50 crore.
- A medium enterprise is an enterprise where the investment in plant and machinery does not exceed Rs. 20 Crore and Turnover not exceed 100 crore.
Shop and Establishment
An Act to amend and consolidate the law relating to the regulation of hours of work, payment of wages, leave, holidays, terms of service and other conditions of work of persons employed in shops, commercial establishments, establishments for public entertainment or amusement and other establishments and to provide for certain matters connected therewith.
GST stands for Goods and Services Tax. GST will be a single, destination based, consumption tax that will replace existing taxes, including CENVAT, Octroi, Sales Tax, and Excise Duty, etc. Unlike the old tax structure, where the state of origin received tax revenue, in the new GST model the state in which goods and services are consumed is the state that will receive the revenue.
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