The sole proprietorship is the simplest business form under which one can operate a business as his own. It has no separate existence from its owner. It simply refers to a person who owns the business and is personally responsible for its debts. Sole Proprietorship is the easiest form of business done in India since it isn’t governed by any specific laws. Under sole proprietorship’s, the compliance’s are minimal and easy to fulfill.
Although sole proprietor doesn’t require any specific registrations, he is advised to obtain a few registrations to make his business function smoothly.
i. If it is a Rented Property: Rent agreement and NOC from a landlord.
ii. If it is a Self-owned Property: Electricity bill or any other address proof.
In addition to the above, there are few registrations required in order to establish the existence of the firm:
You can get yourself registered as Small and Medium Enterprise (SME) under the MSME Act. The application can be filed electronically. Although it isn’t compulsory to register as an SME, it is highly beneficial, especially at the time of taking loan for the business. The Government runs various schemes for SMEs where loans are provided at the concessional rate of interest.
This license isn’t mandatory at all places, but it is required to be obtained according to the local laws. It is issued by the municipal party and is issued on the basis of the number of employees.
You can get yourself registered under GST if your annual turnover is more than Rs. 20 lakhs. Also, if you are doing online business (selling through amazon, flipkart etc.), you are required to get a GST number. For registering under GST, you need the following documents –
a. PAN card, Photo and Aadhar Card of the proprietor
b. Proof of business place (Electricity bill/ rent agreement)
c. Bank statement copy (first page for verifying bank account number, address and IFSC code)
GST registration is easy and can be done via the GST portal. Normally GST number is received within 3-4 days of submitting the application.