The sole proprietorship type is the favorite business form for the small entrepreneurs. It simply allows starting a firm with small capital, short time frame.
It requires a very simple process with minimal legal compliances and formation costs. Most of the local offline businesses prefer proprietorship. Check out the major aspects and requirements for the sole proprietorship firm registration.
Key Features of Sole Proprietorship Firm in India
Traditionally, proprietorship is the preferred way of setting up a small scale business for most of the businessmen. The main features of this business type clearly identify it from the other types.
1. Proprietorship requires one person and is basically a one man show.
2. The business is owned by a single person.
3. Due to the involvement of a single person and minimum legal compliances, it is much easier to start and dissolve the firm.
4. Tax-related and other legal compliances are minimal.
A sole proprietorship structure can be used by a service provider, a manufacturer as well by a trader or a merchant.
How to Establish a Sole Proprietorship Firm in India
All the business structures need to follow the formation procedures and necessary registrations. This brief yet complete procedure for sole proprietorship registration will help you to get ready with the document requirements.
1. The proprietorship registration done under the SSI/MSME Registration at eBizfiling. The list of documents includes only PAN and Aadhar card of the Proprietor.
2. Apply for the GST registration.
3. Obtain the GST registration certificate from the authorities.
4. Open a current bank account.
Though there are no other governmental formalities required for sole proprietorship formation, it may require certain registrations depending upon the business. For example a firm dealing with import or export will need DGFT IEC code registration. For the registrations of GST, we highly recommend you to get help of our professional services available at incredibly low service charges.
Documents Required to Start Proprietorship Firm
The documents requirement for the sole proprietorship is quite simple. Generally it involves the basic documents to identify the proprietor and the firm.
1. Self Attested PAN Card of Applicant
2. Self Attested Aadhar Card of Applicant
3. Self Attested PAN Card of Entity (if any)
This hassle-free registration process aloof of any real legal registration is the best feature of the sole proprietorship firm in India. It is also the oldest form of business in India. Applying for the necessary tax registrations and bank account are the only compliance to start the business.
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Do you think CBDT should extend Tax Audit Report and relevant ITR Due Date? Please Comment, Vote, Retweet and Like.— Tax Guru (@taxguru_in) September 18, 2018