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Getting your business registered under the MSME is not yet mandatory but it is probably the best thing you can do when you have a business in India. Both manufacturing and service companies can register under the MSME with no fees being paid. India is a developing country and has the MSME industries to help in backing up its economy. Registering your company with the MSME gives your business countless advantages as you can receive benefits in taxation, loans, setting up the business and getting credit facilities.
According to the declaration of the MCA, ” Specified Companies (Furnishing of information about payment to micro and small enterprise suppliers) Order, 2019″. This order simply means that all the specified companies are supposed to file in an MSME from 1 details of all outstanding because of the Micro or small enterprises suppliers available on the date of notification of this order within thirty days from the date of publication of this notification.
Apart from government companies, all the other specified companies are to file a return as per MSME Form 1 annexed to this Order, by 31st October for the period from April to September and by 30th April for the period from October to March.
This order is expected by many to continue for several years, there’s already the strict implementation of the reporting by companies furnished information about payment to micro and small enterprise suppliers. This has made many people question the real intentions of this order, the newest moves of the MCA seem more like surveillance capitalism. It is seen more as a means of keeping an eye on people’s financial status which is commonly practiced in western society and other parts of the world.
Hence, all the specified companies who are registered under MSME are supposed to file a mandatory return with the Ministry of Corporate Affairs (MCA) which is in the form of an MSME form 1.
The number one criteria for small and medium business are the net sales generated by a business, this makes it very difficult for any corporate to be able to determine the status of another corporation if it is a small, large or medium firm. The only way to be able to determine if the firm you have to pay dues to is an MSME is by getting a written declaration either by post or mail from the creditors. The declaration gotten should be able to show evidence of their status and should be submitted accordingly with the ministry.
Almost all the businesses in India can be covered under MSME apart from government companies. The type of entities covered under the MSME include
To start the registration process, the owner of the small and medium scale industry is supposed to fill a single form which can be done both online and offline. If anyone has the intention of registering more than one industry, they’ll have to do individual registration.
The information required for the registration includes industry names, address, bank account details, Aadhaar number and other common details which may be required. You can also provide self-certified certificates. The registration process is completely free and once the information is uploaded you’ll be getting the registration number shortly.
When you register your company or firm under MSME you can enjoy a variety of benefits such as,
You’ll be able to enjoy a cheaper bank loan as the interest rates become very low. It becomes much lower than a regular interest loan. You can take loans without worrying about the large interest that’s usually imposed.
Once you are registered, the facility to set up your business is at your disposal. Many rebates and concessions are made available once registered which leads to a cheaper cost to set up the business.
All the businesses registered under the MSME will enjoy from higher preferences when it comes to getting government license and registrations.
The credit of the minimum alternate tax (MAT) is carried forward for 10 years but for a business company under MSME it can be carried forward right up to 15 years.
Moreover, you can enjoy a one-time settlement fee for non paid amounts of the MSME. The companies that are registered under MSME will benefit from government tenders which are only made available to MSME industries.
The government has launched several MSME schemes over the years includes,
Let us try to explain them in detail now:
This government scheme is for women who want to start their own businesses, the government helps them by providing quality training, capital, and everything else necessary for them to be able to start up their businesses and eventually grow.
This government scheme helps implement the ideas, designs, and products of inventors and innovators. With this scheme, up to 80% of a person’s project can be financed by the government. With this scheme, there’s been an increase in the contribution of designs ideas and new products.
By registering under the Grievance monitoring system government scheme, you’ll be able to keep track of your business complaints and getting it addressed. The business owner will be able to check the status of their complain and open them if the outcome was unsatisfactory.
This government scheme is a 12 digit number card known as the Aadhaar card which is given to every individual by the government. The Aadhaar card is a mandatory requirement which benefits in easing the availing credit, subsidies, and loans from the government. Registration can be done either online or offline, whichever is convenient for you.
The purpose of this scheme is to make sure that all the goods that are sent out of India as exportation are of good quality and meet the required standards. This is to avoid any export being sent back to India because it didn’t meet the required standard quality.
There are more schemes which have been launched by the government of India in order to help the population of the country. The MSME has proven to be nothing less than a bundle of good intentions by the government as they have shown their intention to help any small or medium business in the country.
The rapid increase in corporate irregularities which has flooded recently has led to the MCA (Ministry of Corporate Affairs) to make the decision that the disclosure of regular information by specified companies will be more strict.
For more information related to the MSME Registration, kindly contact Enterslice