Sole Proprietorship

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 proprietorships can bring lawsuits (and can be sued) using the name of the sole proprietor owner.

Checklist Items for a Sole Proprietorship Registration

  • A certificate/license issued by Municipal authorities under the Shop & Establishment Act.
  • The license issued by Registering authorities like the Certificate of Practice IS issued by the Institute of Chartered Accountants of India.
  • The registration/licensing document is issued in the name of the proprietary concern by the Central Government or the State Government Authority/ Department, etc,
  • The banks may also accepts the IEC (Importer Exporter Code) issued to the proprietary concern by office of the DGFT as an identity document for opening of the bank account etc,
  • Complete Income Tax return (not just the acknowledgement) in the name of the sole proprietor where the firm’s income is reflected, duly authenticated and acknowledged by the Income Tax Authorities,
  • The utility bills such as electricity, water, and the landline telephone bills in the name of the proprietary concern,
  • Issue of GST Registration/Certificate.

ADVANTAGES

  • Minimum Compliance
  • Simple To Begin
  • Economical

DOCUMENTS REQUIRED

To start a Sole Proprietorship, the following documents are required

  • Address and identity proof
  • PAN card, KYC documents and
  • Rental agreement or sales deed (in case of Shops & Establishment Act Registration).
  • What Are The Documents Required For Opening A Current Account