Sole Proprietorship is the easiest form of business done in India since it isn’t governed by any specific laws. Under sole proprietorships, the compliances 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.
Aadhar Card – Aadhar number is now a necessity for applying for any registration in India. Also, income tax return can only be filed if the person has linked his PAN card with Aadhar number. Contact nearest E-Mitra or Aadhar Seva Kendra if you haven’t got an Aadhar number yet. After applying for Aadhar card, a hard copy of the same is received at the registered address in around 15-20 days.
PAN Card – You can’t file your income tax return until you get a PAN. So if you don’t have a PAN number, apply for it at the earliest.
PAN card can be applied online and it costs Rs. 110, approximately. For applying, you need a scanned photograph, identity proof, and address proof. The form can be submitted online by verifying it through Aadhar e-KYC.
Once PAN card application is submitted, it is checked at NSDL for verification, and if NSDL finds the information correct, it allots the PAN number within 7-8 days. Further, a hard copy of PAN card is received at the registered address within 15-20 days.
Bank Account – After you have got Aadhar Number and PAN, you can visit any bank for opening an account with them. Apart from Aadhar Number and PAN, you need to carry identity proof and address proof. For opening a current account, you need to submit GST registration document to the bank officials too.
Registering as SME – 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.
Shop Act License – 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.
GST Registration – 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 –
- PAN card, Photo and Aadhar Card of the proprietor
- Proof of business place (Electricity bill/ rent agreement)
- 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.