Home » Points to consider prior to application of proprietorship firm registration

Points to consider prior to application of proprietorship firm registration

by komal_singh

A sole proprietorship requires the following basic registrations: The proprietor must obtain a Registration Certificate under the Shops and Establishment Act of the state in which the business is located. If the business turnover exceeds Rs. 20 lakh, the sole proprietorship must also register for GST.

Looking for proprietorship firm registration is easily available now. With the extension of the top-notch legal concepts, registering is now easy. 

Now let us see what is sole proprietorship?

A Sole Proprietorship is a type of business organization in which a single person manages the company. In general, there is no need for registration. This type of business form is suitable for anyone who wants to start a business with a low initial investment.

  • What is the provision in sole proprietorship? 

The single proprietor/owner has complete control over the business. A single person who wants to start a business from home or on a premise with a small investment can choose this type of business. As a sole proprietorship firm, you can establish many local businesses such as grocery stores, parlors, boutiques, and retail stores. 

  • Know the norms appropriately 

A sole proprietorship firm can be established by even small traders and manufacturers. It is important to know who can take the proprietorship registration facility. This type of business form is suitable for anyone who wants to start a business with a low initial investment. It can be started in as little as 10-15 days. Furthermore, you have complete control over the business.

Documents required for Registration 

Documents required for Proprietor Registration are as follows:

  • Aadhaar Card
  • PAN Card
  • Registered Office proof
  • Bank Account

Basic Advantages of Sole Proprietorship

  1. Less compliance

A sole proprietorship is a simple business that can be started by one person. There is a minimum level of compliance that must be met in order for it to be incorporated. This type of business is cost-effective because it is less expensive to establish than a corporation or LLP.

  1. Management of the company

The sole proprietor will have complete authority over the company. He will be in charge of all aspects of the company. Secrecy can be maintained because the company is run by a single person.

  1. Decisions must be made quickly

The sole proprietor makes all business decisions. The decision is made by a single person. As a result, decisions can be made quickly and without consulting with anyone.

  1. Procedures for sole proprietorship firm

The procedure for forming a sole proprietorship firm is as follows:

  • Application for a PAN card
  • The next step is to keep a name for the sole proprietorship business after obtaining a PAN card, or if the proprietor already has a PAN card.
  • The following step is to open a bank account in the name of the company. This bank account will be used for all business transactions.

 

Here’s a proper checklist required for Firm registration-

  • The proprietor’s PAN card
  • The company’s name and address
  • Open a bank account in the name of the company
  • Registration under the respective state’s Shop and Establishment Act
  • If the business’s turnover exceeds Rs.20 lakhs, it must register for GST

Final Words 

The sole proprietorship firm registration needs to be completed through proper registration. As a sole proprietor, you must file an annual Income Tax Return. If you are registered for GST, you must also file your GST Return. If a sole proprietor is subject to a tax audit, he or she should deduct TDS and file a TDS return.

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