In this article, we precisely mention the types of Udyam Registration available and then a list of Documents Required for Udyam Registration
Registering your business on the Udyam portal is very important to gain all the benefits attached to the MSME sector. The government has made it easier for businesses to register themselves with the Udyam portal. Unlike the earlier processes, which required hefty documentation and lengthy procedure, the current scenario requires only minimal documents. In this article, we will read all you need to know about the Documents Required for Udyam Registration.
What is Udyam Registration?
Udyam Registration is a process for registering Micro, Small and Medium Enterprises (MSMEs) in India. It is a nationwide, online portal launched by the Ministry of Micro, Small and Medium Enterprises (MSME) in 2020. Previously known as MSME Registration or Udyog Aadhaar, Udyam Registration simplifies the registration process and eliminates the need for multiple registrations with different authorities.
Types of Udyam Registration
There are three categories of MSME registration based on certain business factors, such as investments and turnover.
These are :
- Micro Enterprises: Enterprises where investment < ₹1 crore and turnover < ₹5 crores.
- Small Enterprises: Those whose investment < ₹10 crores and turnover < Rs 50 crore
- Medium Enterprises: Those whose investment <Rs. 50 crore and yearly turnover < 250 crores.
Suppose any enterprise surpasses the previous amount of investment and turnover. In that case, it will be moved to the next category of MSME. In order to categorise any business into a micro, small or medium enterprise, it is important to take into consideration the total investment and turnover of all the units registered under the same pan number.
To calculate a firm’s investment and the previous year’s income tax returns are considered. Suppose no ITR is available (which is the case in new enterprises). In that case, the self-declaration of the proprietor will be the basis for the calculation of an investment.
While calculating the turnover of an enterprise, exports of goods and services will not be considered.
Documents Required for Udyam Registration
In the list of documents that are required for Udyam registration online, the elements required are as follows-
- Aadhaar card
- Pan card
- Bank account details
- Business address
- Details of business activities
- Information of the investment (plant, equipment, machinery)
- Information on the turnover
- Duplicates bill of sale and purchases
- Partnership deed (if any)
- NIC code of 2 digits
- Copies of bill and license of the machinery purchased
- Details of the applicant such as mobile number, email address, etc.
- Certificate of disability (if any)
- Miscellaneous information such as the number of employees, Social category, etc.
In the form filled by the applicant, it is to be clearly stated if the firm has more than one office or production unit. Also, the details of all of them have to be filled in.
The social category of the applicant is also to be stated with the required certificate. They should clearly state if they want to register as a manufacturer, a service provider, or both. Also, it is asked from the applicant if they are willing to participate in the government-created and run Gem portal or not.
Things to Take Care of Before Registration
Below are some essential things you should keep in mind while doing Udyam registration.
- No fee is required for Udyam registration online.
- You need an Aadhaar number for registration. In cases of ownership organization, the aadhaar number of the owner will be required. In the case of a partnership, the aadhar number of the managing partner is required. While in the case of a HUF(Hindu entire family), the aadhar number of the ‘Karta’ is needed.
- If your industry is a pre-existing firm, you should attach your pan number and GST to automatically take your investments and turnover information from the government database.
- You can file only one Udyam registration. Even if you are involved in multiple manufacturing or service-related firms, all will be included in one registration.
- The legal signatory’s GSTIN, PAN, and Aadhaar numbers would be required in a few cases. These cases include:
- Limited partnership
- A trust
- A cooperative society
- Any person or firm with prior EM-II or UAM registration or any other certificate provided by the ministry of MSME still has to register with the Udyam registration.
- Any applicant who performs activity such as miss representation or suppression of information would be granted punishment according to claws 27 of the MSME act.
Benefits of Udyam Registration:
- Easy and paperless online registration process
- Single registration valid across the country
- Access to various government schemes and benefits
- Improved creditworthiness and easier access to loans
- Increased visibility and credibility in the market
Eligibility Criteria for Udyam Registration
Any enterprise engaged in manufacturing or service activities and meeting the following investment and turnover criteria can register under Udyam:
|Investment in Plant & Machinery or Equipment (Rs.)
|Up to 1 crore
|Up to 5 crore
|Up to 10 crore
|Up to 50 crore
|Up to 50 crore
|Up to 250 crore
Government Schemes with Benefits for MSMEs
You would wonder why it is so important for any new business in India to register with the government. We will now talk about the various government schemes, whose benefits you will be able to take only if you are registered with the government as an Udyam.
- Women entrepreneurship scheme: The government initiated this scheme to encourage women to start their businesses. The women who wish to do so are provided with the necessary help, counseling, and training by the government of India so that they can take good care of their businesses.
- Grievance monitoring system: This portal is created for the firms registered as Udyam in order to facilitate them by solving any kind of complaints and providing quick resolution. You need to be registered as an MSME to take advantage of this portal.
- Capital subsidy scheme: If you are registered in the Udyam portal. You can easily avail of loans from the government banks to replace your old and worn-out machinery and equipment with a new one. This facility helps you raise funds with a lot of ease and subsidy.
- Quality management standards: This government scheme was started to encourage healthy competition amongst different firms selling the same products and services. This ensures better quality goods and services. The government ranks the products made by them based on specific quality parameters.
- Udyog Aadhaar memorandum scheme: This scheme makes it easy for any MSME registered with the government to provide loans, credit, and government subsidies.
- Zero defect, zero effect: If you produce goods or provide services of good quality (according to the standards set by the government) that are exported and are not returned to India, you are entitled to rebates and concessions for the goods you export.
Therefore, you need to register with the government if you are an MSME to avail a plethora of benefits. With all the required documents at your disposal and all the necessary things in mind, you can easily apply to the portal online without visiting any government office.
What is the Udyam Registration process, and is it an online-only registration system?
Udyam Registration, also known as MSME Registration, is a revamped method for enrolling Micro, Small, and Medium Enterprises (MSMEs) introduced by the Ministry of Micro, Small & Medium Enterprises on July 1, 2020. The registration process is entirely online and free of cost.
Are there any fees associated with the Udyam Registration process?
There are no fees associated with the Udyam Registration process. The registration is entirely free and paperless, based on self-declaration.
Can existing MSMEs transition to Udyam Registration, and what is the deadline for the transition?
Existing MSMEs can transition to Udyam Registration, but there is no specific deadline for the transition. It is advisable to contact the Government of India or the relevant authorities for more information on the transition process.
What documents are required for Udyam Registration, and how can they be submitted online?
The required documents for Udyam Registration include: Aadhaar Number Name of Entrepreneur Name of the enterprise Type of enterprise (Proprietorship, Partnership, Hindu Undivided Family (HUF), Company, Limited Liability Partnership, Cooperative Society, Society, or Trust) Date of incorporation Date of commencement of production/business GSTIN (for businesses where applicable) and PAN along with its Aadhaar number The registration process is entirely online and you can submit the required documents through the Udyam Registration Portal.
How long does it take to receive the Udyam Registration certificate after applying?
The exact time frame for receiving the Udyam Registration certificate after applying varies depending on application volume, but it usually takes a few days.
What are the implications for MSMEs that do not register under the Udyam Registration system?
MSMEs that do not register under the Udyam Registration system may not be able to avail the benefits and recognition associated with Udyam Registration, such as obtaining a permanent registration number and a recognition certificate. It is advisable to register under the Udyam Registration system to ensure your business enjoys the full range of benefits and recognition that comes with it.