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Sole Proprietorship Firm Registration

Sole Proprietorship is the easiest form of business done in India since it isn’t governed by any specific laws.
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Sole Proprietorship Firm Registration

Sole Proprietorship refers to an entity run and owned by one individual wherein, there is no difference between the owner and the business. Sole Proprietorship is the easiest form of business done in India since it isn’t governed by any specific laws.

A sole proprietorship can operate under the name of its owner or else do business using a fictitious name. It is a popular form of business in India, because of its simplicity of set up and nominal cost. Proprietorship falls under the category of unregistered business.

Sole Proprietorship Registration Process

Advantages Of One Person Company (OPC)

Easy to Start

A Proprietorship business needs no registration. Therefore, it is one of the easiest to start with no formalities. However, after starting up the Proprietorship, it is relatively harder to open a bank account or obtain a payment gateway in the name of the business – since more registrations may be required.

No Restrictions on Business Name

Since the name of a Proprietorship is not registered, a Proprietorship can choose to have any name – as long as it does not infringe on a registered trademark. However, since the name is not registered, any other person can also use the same business name unless trademark registration is obtained.

Tax

A Proprietorship with less than Rs. 2 lakhs of income is not required to pay any income tax, as Proprietorship are taxed as the individual owing the business. However, once, income of the business exceeds Rs. 10 lakhs per annum, there are no major advantages for a Proprietorship in terms of taxation.

How We Do It ?

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Frequently Asked Questions - FAQs

  • Who can be a Proprietor?

    The Proprietor must be an Indian citizen and a Resident of India.

  • I need to get my business registered in multiple locations Can it possible ?

    There is no limit on number of branches that you can add under a single GST registration application, provided all the branches are in Same State.

    If you have multiple places of businesses in same state, you can get them all registered under a single GST registration application. Give the name of your registered business place as primary place of business, the other branches can be added as additional places of business at no additional cost.

  • Shops and Establishments Act license required?

    Every shop and establishment needs to register itself compulsorily under this Act within 30 days of commencement of work. As this is such a basic license, many other licenses require this as proof of a commercial business. For example, most banks will require you to furnish it if you want to open a current account.

  • What is the minimum capital is required to start a Proprietorship?

    A proprietorship can be started with any amount of minimum capital.

  • Can other people invest in a Proprietorship?

    Proprietorship firms are business entity that are owned, managed and controlled by one person. So Proprietorship firms cannot issue shares or have investors.

  • What is the risk in Liability ?

    In the firm you have unlimited business liability. If you liable to pay any liability to creditors then bank or creditor can claim your personal assets also legally to repay the debt.

  • How many persons need to start a Proprietorship?

    Yes, only one person is required to start a Proprietorship and a Proprietorship can have only one promoter.

  • Can I transfer my Proprietorship?

    A business operated by proprietorship firm cannot be transferred to another person, unlike a Limited Liability Proprietorship or a Private Limited Company. Only the assets in the Proprietorship can be transferred to another person through sale. Intangible assets like Government approvals, registrations, etc. cannot be transferred to another person.

  • Can I add another partner for funds ?

    Sole Proprietorship firm can’t include the partners in future.It’s a Simple firm so you can’t raise the funds from Angel Investor or VC Firms like selling your equity or share to another person and raise the money from that person

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