08 Oct
WHAT IS A SOLE PROPRIETORSHIP
WHAT IS A SOLE PROPRIETORSHIP?
PROPRIETORSHIP
COMPLETE INFORMATION
Doing business in PROPRIETORSHIP is one of the simplest
and easiest forms where a single person owns and is personally responsible for
all the payments and receipts of the business. It is the most reported in India
due to its low cost and low documentation process and low legal requirements.
PROPRIETORSHIP registration can be done in 3 ways:
1) Register under the Shop and Establishment Act. GUMASTA
2) Get industry support under MSME Ministry. UDYAM Registration
3) Get GST registration. GST
1.
Registration of sole proprietorship under the Shop and Establishment Act
SOLE PROPRIETORSHIP If you have a shop for your business,
you can register your business under the Shop and Establishment Act.
Here, the shop is such an area
1) Goods are sold through retail and wholesale
2) A place from where services are provided to customers.
3) It includes an office, a store-room, warehouse,
warehouse or workplace, in the same premises or otherwise, which is used in the
context of such trade/business.
This does not include factories, commercial
establishments, residential hotels, restaurants, eateries, theatres or other
places of public entertainment or recreation;
If you have a shop as defined above, you can register
your SOLE PROPRIETORSHIP business under the Shop and Establishment Act.
2. SOLE
PROPRIETORSHIP Registration through MSME
Enterprise Aadhaar under MSME Ministry
Enterprise Aadhaar is a unique identification number
provided to business owners by the Ministry of MSMEs.
SOLE PROPRIETORSHIP can also apply for Industry Support
along with all other like Pvt Ltd Company and Partnerships.
3. SOLE
PROPRIETORSHIP registration through GST registration
GST registration is another way to register your SOLE PROPRIETORSHIP. You can apply for GST registration if you are dealing in any kind of exchange of goods and services.
GST registration is a great way to get an identity of
your SOLE PROPRIETORSHIP. However, there are some important things to know
before choosing this method.
The only drawback under GST registration is that it is
mandatory to do all GST FILING after registration. Every registered business is
forced to collect tax from the customer, pay to the government and file a GST
return.
If a SOLE PROPRIETORSHIP has a turnover of less than Rs.
40 lakhs (goods) and less than Rs. 20 lakhs (services), it is not COMPULSORY to
register and deposit GST.
However, still, if he chooses to register under GST to
register his proprietorship, then he will have to do avoidable and unnecessary
filing.
WHICH OF THE ABOVE 3
WAYS OF SOLE PROPRIETORSHIP REGISTRATION IS THE BEST?
After evaluating these three options, in our opinion, if
you are a SOLE PROPRIETORSHIP whose business sales If it is more than Rs 20
lakh, you should go for GST registration to get the business recognition as it
is a comprehensive form known as SOLE PROPRIETORSHIP.
However, if your turnover is less than Rs 20 lakh, GST
registration will not be very beneficial for you as you will have to pay a lot
of returns after getting the GST number.
Getting to know the business is your main reason. You can
opt for registration under the Shop and Establishment Act or apply for udyam
adhar.
IS SOLE
PROPRIETORSHIP REGISTRATION MANDATORY?
No, SOLE PROPRIETORSHIP registration is not mandatory. It
is optional whether a person should register his own proprietor or not.
Although, if you are considering opening a bank account
in the name of your business, it is required by law to register full ownership,
it is not mandatory by law.
Even if you register your SOLE PROPRIETORSHIP, the
government will not issue a new PAN card for it. The same PAN card of the
proprietor will be applicable for sole proprietorship rights.
SOLE
PROPRIETORSHIP BENEFITS
There are several benefits to starting your own business
as a SOLE PROPRIETORSHIP, some of which are listed below,
1) Fewer tax returns have to be filed
2) Getting started is easy
3) Efficient cost & operation cost is low
4) Anyone can choose any business name
5) Perfect control is with you
6) It is easy to close
7) Documents required for taking a loan
If you need more information you can contact
us
9769201316
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