Sole Proprietorship Registration – An Overview

Aspect Details
Fees Packages start from Rs. 2,699 (Lowest Fees Guaranteed by Enterslice)
Timeline Usually, it takes 1 to 2 weeks to complete the process for sole proprietorship registration in India.
Advantages
  • No minimum capital required
  • Lower compliances
  • Sole ownership
  • No profit sharing
  • Pass through taxation
Eligibility
  • Unique name of the business
  • Above 18 years of age
  • Citizen of India or Person of Indian Origin
  • Capacity to enter into a contract
Step-by-Step Procedure
  • Choose a Unique Business Name
  • Mandatory Documentation
  • Apply for PAN Card
  • Open a Bank Account
  • Obtain Necessary Licenses
Documents Required
  • PAN Card
  • Aadhar Card
  • Utility Bills
  • Bank Account Details
  • No Objection Certificate
  • Rental Agreement
How can we help you?
  • Secure PAN and TAN
  • Obtain GST Number
  • Process Paperwork
  • Apply for MSME Registration
  • Provide Shop and Establishment License
  • Update Latest Regulations

Build your Business Empire in Indian Economy worth $4 Trillion

Let our business consultants make the journey of sole proprietorship registration easy.

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Register Sole Proprietorship Firm Effortlessly and Timely with Us

Sole proprietorship registration in India is one of the oldest and easiest ways to business structures in India. A sole prop registration is not defined under any law, neither there is any form of regulation governing the registration of a sole proprietorship business. The registration of sole proprietor in India follows a unique approach, which requires the firm to gain recognition through tax registration. Register sole proprietorship firm with our experts.

As there is no formal sole proprietorship registration process, the applicants are only required to choose a business name, open a current bank account, and file applications to get PAN and TAN recognition for this business structure. Enterslice can help you manage your business processes without legal complications for sole proprietorship company registration in India!

Quick Business Setup

Ease of Doing Business

All Profits to the Founder

Business Friendly Regulations

Access to Business Loans & Grants

Sole Ownership & Decision Making

Advantages of Sole Proprietorship Registration in India

The essence of sole proprietorship registration in India is to manage and carry out all the activities associated with this business structure. A sole proprietorship is considered more advantageous for small and medium-scale enterprises. However, other advantages of registering a sole proprietorship business in India include the following:

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No Compulsory Registration

No compulsory sole proprietorship registration is required for sole traders. However, if the business is carrying out activities that require registration as per the MSME Act 2006, then all such registrations are mandatory.

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Minimum Compliance Required

Compared to other forms of business structure, sole proprietorship registration requires minimum ongoing compliance requirements. Lower compliance requirements make it a simple business structure, easy to manage, and with minimal violation risk.

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No Sharing of Profits

Any profits earned after online sole proprietorship registration are directed towards the sole proprietorship firm's owner. The owner of this business structure enjoys all the profit accruing during the business.

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Easy and Simple Registration

Sole proprietorship registration is relatively easy and simple. It does not require formal incorporation or dissolution. However, sole proprietors must obtain specific licenses to comply with particular regulations.

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Complete Business Control of the Business

A sole proprietorship is wholly managed and operated by a single individual, also known as the sole owner or sole proprietor. The sole owner is authorized to control business decisions, strategic planning, and daily operations.

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Pass-Through Taxation

The sole proprietorship business structure follows the practice of pass-through taxation, where the business is not taxed separately from its sole proprietor. It demonstrates a specialized tax status that dissolves the burden of double taxation.

Procedure To Register Proprietorship Firm Online in India

There is no formal procedure for registering a proprietorship firm. To register proprietorship firm online in India easily, you need to follow the below-mentioned steps, including:

Choose a Unique Business Name

The first step requires the applicants to select a unique name that reflects the nature of the business. Reserving a unique name for the sole proprietorship business must comply with Indian intellectual Property laws.

Mandatory Documentation

Next, the applicants must collect all mandatory documents, including a valid ID, address proof, and the primary location of the business activities. They are also required to check the authenticity of the collected documents mandatorily.

Apply for a PAN Card

The next step involves filing an application to obtain a PAN card for the proprietorship firm. The PAN card acts as the ID proof and license for the business to run its necessary operations.

Open a Bank Account

The sole proprietorship registration also requires the sole traders to open a current bank account in the name of the business or PAN obtained. In addition, traders are required to submit proof of doing business.

Obtain Necessary Licenses

The last requirement to register a sole proprietorship firm in India is for the sole proprietors to obtain necessary licenses, such as MSME license, a Shops and establishment license, an import-export code license, and an FSSAI license.

Timeline for Sole Proprietorship Firm Registration

The process for sole proprietorship firm registration in India is simple, taking 1 to 2 weeks for the end-to-end process. Following is the timeline for sole proprietorship registration process in India:

Documentation: 1 to 2 days

Typically, it takes 1 to 3 working days to obtain, submit and verify the documents for registering a sole proprietorship firm in India.

Choosing a Unique Business Name: 1 to 2 days

Choosing and reserving a unique business name is a must for sole proprietorship company registration and takes 1 to 2 business days.

Application Filing: 3 to 5 days

The preparation and filing of the application to acquire a PAN Card for the sole proprietorship business generally takes around 3 to 5 business days.

Sole Proprietorship Business Registration: 2 to 5 days

The mandatory registrations for sole proprietorship businesses, including GST, Shop, and Establishment registrations, take 2 to 5 business days.

Opening Bank Account: 1 to 2 days

Professional consultants take 1 to 2 business days to successfully open a bank account for a sole proprietorship firm in India.

Professional Tax Registration: 1 to 2 days

It generally takes 1 to 2 business days to apply and obtain professional tax registration for your sole proprietorship business in India.

Obtaining Necessary Licenses: Varies

The time it takes to obtain necessary licenses in India varies depending on the nature, requirement, and state in which the license is being applied for.

Documents Required for Sole Proprietorship Registration in India

The documents required for sole proprietorship registration in India include the following:

PAN Card- Proprietor

Address Proof- Utility Bills

Valid ID Proof - Aadhar Card/Passport/Voter ID

Bank Account Details

Rental Agreement or Sale Deed

No Objection Certificate- For Rented Property

Register A Sole Proprietorship Online with Enterslice

Partner with Enterslice to register a sole proprietorship online and experience seamless sole proprietorship registration process. Our dedicated range of services are designed to assist you in smooth and efficient operation of your business activities. We offer a gateway to customized business solutions to manage the wealth and growth prospects of your business structure.

We are committed to deliver consulting, legal advisory and other business solutions to successfully register your sole proprietorship firm. We deliver innovative, sustainable and tech-enabled solutions to support your entrepreneurial journey as a sole proprietor.

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Round-the-clock Support

Sole Proprietorship Firm Registration Fees

The sole proprietorship firm registration fees in India depends on different factors, including business structure, specific needs, and licenses and permissions required. Therefore, the overall sole proprietorship registration cost varies when registering the business in other states. Get your sole proprietorship registered to start at just Rs. 2699, with a quick turnaround time and a seamless process guarantee.

We recommend choosing the best expert consulting agents, offering transparency and the lowest registration fees.

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Professional Fees

Professional fees include our consultancy charges to ensure timely registration of sole proprietorship.

Government Fees

It includes the fee charged by the government for PAN Card application to incorporate a sole proprietorship successfully.

GST Registration Fees

The GST Registration fee includes a small cost to register a sole proprietorship business in India.

Professional Licensing Fees

This fee includes professional licensing charges for FSSAI and the Import-Export Code. It varies depending on the line of business.

Prerequisite for Sole Proprietorship Firm Registration Online

  • Shop and Establishment License :- Sole traders must obtain a Shops and Establishment License to conduct business activities in India.
  • UDYAM Registration :- Applicants must obtain UDYAM MSME registration under the MSME Act to enjoy the benefits provided under it.
  • GST Registration :- Sole proprietors must also register for GST if the business's annual turnover exceeds Rs. 20 lakhs.
  • Minimum Capital Requirement :- There is no minimum capital requirement to register a sole proprietorship business in India.
  • IEC Registration :- The sole traders carrying out goods export outside India are required to obtain IEC registration with the Director General of Foreign Trade (DGFT).
  • Register with FSSAI :- Sole traders engaged in activities concerning the production or packaging of food products are mandatorily required to obtain FSSAI registration license in India.

Factors Leading to Delays in the Sole Prop Registration Process

Nowadays, a consistent delay in the registration of sole proprietorship companies is observed in India. This delay hampers the conduct and profitability of the business. Insufficient or inaccurate documentation prepared by the applicants might lead to a delay in the sole prop registration process. Also, the requirement to secure regulatory approvals or permits before starting a business of sole proprietorship in India is yet another factor leading to consistent delays in the sole proprietorship registration process.

Moreover, any delays in payment processing or verification pose external challenges to the smooth and easy registration process for sole proprietorship businesses in India. These delays have led to many small businesses failing due to the financial and management constraints faced by the applicants. It is crucial for businesses to carefully consider their options to increase their chances of success.

Eligibility Criteria to Register for a Sole Proprietorship

The eligibility criteria required to register for a sole proprietorship in India are as provided below:

Checklist for Sole Proprietorship Business:

  • The PAN Card of the owner
  • MSME Registration
  • Unique name of the business
  • The clear purpose of the business
  • Prevent selling illegal goods and services
  • GST registration if annual turnover is more than Rs. 20 lakhs

Checklist for Sole Proprietors:

  • Above 18 years of age
  • Capacity to enter into a contract
  • Not declared bankrupt
  • Not previously convicted of violations
  • No legal disabilities
  • Citizen of India or Person of Indian Origin

Post-Registration Compliances for Sole Proprietorship

Post-registration compliance for sole proprietorship requires the applicants to stay informed and seek professional advice to avoid fines or legal penalties. Consider the following post-registration compliances for proprietorship company registration, which must be duly adhered to by the applicants:

  • TDS Compliance
  • Income Tax Return Filing
  • Annual Audits
  • Documentation of Invoices for filing GST
  • Filing Financial Statements
  • GST Registration & Filing
  • Labour Law Compliance
  • Business License Renewals
  • Filing Annual Returns
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Trust Enterslice for Sole Proprietorship Registration in India

The applicants must secure the timely registration of their sole proprietorship business in India. Our team of professionals, comprising company secretaries, chartered accountants, and lawyers, have in-depth experience registering different business structures.

Partner with Enterslice to enjoy smooth and easy sole proprietorship registration in India. Given below are the reasons why brands prefer to register for a sole proprietorship firm with our experts-

  • Ensure a Unique Business Name for your Sole Proprietorship Firm
  • Saved Rs 20 Lakh of Business Owners
  • 99% Client Repetitive Value for our Sole Proprietorship Firm Registration Service
  • Secure PAN and TAN for Sole Proprietorship Firm
  • Apply for GST Registration for Sole Proprietorship Firm
  • Collection of Relevant Documents for Sole Proprietorship Firm Registration
  • MSME Registration Application for Proprietorship Firm
  • Shop and Establishment License for Sole Traders
  • Keep up with the Latest Updates on Sole Proprietorship Regulations
  • 24/7 Customer Support for Proprietorship Company Registration

Frequently Asked Questions

No, sole traders or proprietors are not required to register their sole proprietorship firm in India. However, they must follow the respective state governments' rules, regulations and guidelines.

The process to self-register a sole proprietorship firm in India requires applicants to start by applying for name reservation, document preparation, and online filing for a PAN Card.

No, GST registration for proprietorship is not mandatory for sole prop registration. However, if the sole proprietorship crosses the annual turnover threshold of Rs. 20 lakhs, it becomes mandated to obtain GST registration.

The estimated cost required to register proprietorship firm online in India ranges between Rs. 2699 to Rs 10,000. The total cost depends on the licenses the sole proprietorship firm needs to obtain in the particular state.

Yes, sole proprietors are required to obtain a PAN card, which must be registered under the business entity's name. PAN cards serve as proof of identity for the sole proprietorship.

The tax slab for sole proprietorship business in India is set at 5% for any income above Rs. 2,50,000, Rs. 12,500 + 20% on total income above Rs.5,00,000, and Rs. 1,12,500+ 30% of total income above Rs. 10,00,000. The tax includes the surcharges, which must be paid along with the prescribed tax.

A sole proprietorship registration online offers unique benefits to its owners, including:

  • No compulsory business registration requirement
  • Minimum compliance requirement
  • No profit-sharing hassles
  • Complete control over the business operations
  • Pass through taxation

No, a sole proprietorship business firm cannot acquire two GST numbers for the same business structure. A single GST registration number covers all the business activities under the sole proprietorship's umbrella.

No, UDYAM MSME registration is not mandatory for sole proprietorship. Hence, it is only registered depending upon the fulfilment of specific criteria provided under the regulations.

Yes, sole proprietorship businesses in India are legally authorized to use their personal bank account to receive and make business payments. However, creating a separate bank account to conduct business transactions and maintain transaction records is advisable.

Generally, it takes 1 to 2 weeks to successfully register a sole proprietorship firm online in India. However, the process may be delayed depending on the license requirements in different states.

Pass-through means that the income generated by the fund will be taxed in the investor's hands and not at the fund level. Here, the investor bears the tax liability on the income generated from the investment.

The MSMED Act 2006, which was updated on June 1, 2020, defines Micro, Small, and Medium Enterprises (MSMEs) based on their investment in plants, machinery, and equipment. It also considers the annual revenues earned, and this investment excludes land and buildings.

Udyam Registration, also known as MSME Registration, is a government registration that certifies the legal status of a small or medium business (SME). This certificate is important as it declares the SME operational.

To register your company as a sole proprietorship, you need to follow the below-mentioned steps:

  • Open a business bank account
  • Obtain all the required licenses
  • Register for GST (optional)
  • Adhere to legal compliances

To choose a unique business name for your sole proprietorship, you need to check whether the name you selected exists or not. You can do an online search yourself or check with the local authorities to confirm whether the name you selected is unique.

You must follow the due procedure to apply for GST registration for your sole proprietorship. You need to:

  • Fill out the application form
  • Fill Part A – Share details including PAN, mobile number, email ID, and state
  • Generate TRN
  • Fill Part B – Login using TRN, fill bank account and place of business details
  • Upload the required documents
  • Wait for ARN generation to verify the submission
  • Wait for approval from relevant authorities

List of compliances that should be followed to register sole proprietorship include:

  • Obtaining Licenses under the Shops and Commercial Establishment Act, GST etc
  • Open a current bank account for the business
  • Maintain the account books
  • File annual income tax returns

Yes, you can get sole proprietorship registration online. However, you need to follow the due procedure by applying for licenses including GST, Shops and Establishment Act, opening a bank account in business name. This process may vary depending on the state where the sole proprietorship registration is being done.

 

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