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Why Should I Use Vakilsearch for Sole Proprietorship Registration?

Vakilsearch has a team of registration experts who can provide complete guidance to register your sole proprietorship.

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Fix an appointment

Our team of experts will get in touch with you and collect all necessary documents and details

Step 1

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Resolve all your queries

We fill out and file your application for registration

Step 2

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Complete registration assistance

Your sole propreitorship is registered

Step 3

What is a Sole Proprietorship?

When a business is owned and governed by one person, it is called a sole proprietorship company. This type of business can be incorporated in fifteen days and hence makes it one of the most popular types of business to begin in the unsystematic sector, specifically among merchants and small traders. For a Sole Proprietorship business, registration is not required as it is identified through alternate registrations, such as GST registrations. However, its liability is unlimited and it also doesn’t have perpetual existence.

advantages of a sole proprietorship business

Checklist Items for a Sole Proprietorship Registration

  • A certificate/license issued by Municipal authorities under the Shop & Establishment Act.
  • The license issued by Registering authorities like the Certificate of Practice is issued by the Institute of Chartered Accountants of India.
  • The registration/licensing document is issued in the name of the proprietary concern by the Central Government or the State Government Authority/ Department, etc,
  • The banks may also accept the IEC code (Importer Exporter Code) issued to the proprietary concern by the office of the DGFT as an identity document for opening of the bank account etc,
  • Complete Income Tax return online (not just the acknowledgement) in the name of the sole proprietor where the firm’s income is reflected, duly authenticated and acknowledged by the Income Tax Authorities,
  • The utility bills such as electricity, water, and the landline telephone bills in the name of the proprietary concern,
  • Issue of GST Registration/Certificate.

Compliances Required For Sole Proprietorship Firm

Some of the compliances that apply to a sole proprietorship include the following:

  • Income Tax Return Filing: The proprietorship's business owner must submit a personal income tax return using form ITR-3 or ITR-4
  • Business Income: Only the ITR-3 and ITR-4 income tax forms allow for the declaration of business income. As a result, in order to comply with income tax requirements, all proprietorships must submit forms ITR-3 or ITR-4
  • GST Return Filing: If a proprietorship is registered for GST, a filing GST return each month and every three months in accordance with the business's registration plan
  • TDS Returns: Tax must be withheld at source and TDS returns must be filed quarterly if the proprietorship has employees or spends more than a specific amount on goods and services.

In addition to the mentioned points, the proprietorship may also need to comply with additional regulations according to its industry and region.

How Vakilsearch Executes A Sole Proprietorship Registration Procedure?

Professional Guidance

Our experts give you professional guidance on many of the processes involved in registering your business as a sole proprietorship, along with registration of service tax, sales tax, import/export code, and professional tax.

Vendor Relationship

Our team will connect you with an established vendor who will book your application and also keep you updated on its status and progress. The vendors we have onboard are well-accomplished and skillful in managing native registrations.

15 Business Days

Our team will offer full assistance with the registration process. This could vary between 5 and 15 days, depending on the task at hand for the authorities involved.

What Are The Documents Required For Registering A Sole Proprietorship?

To start a Sole Proprietorship, the following documents are required

  • Address and identity proof
  • PAN card, KYC documents and
  • Rental agreement or sale deed (in case of Shops & Establishment Act Registration).

What Are The Documents Required For Opening A Current Account?

To open a current account, the following documents are required;

  • Proof of the existence of your business
  • Shops & Establishments Act Registration
  • PAN card
  • Address and Identity proof

Proprietorship Vs Limited Liability Partnership (LLP) Vs Company

FeaturesProprietorshipPartnershipLLPCompany
DefinitionUnregistered type of business entity managed by one single personA formal agreement between two or more parties to manage and operate a businessA Limited Liability Partnership is a hybrid combination having features similar to a partnership firm and liabilities similar to a company.Registered type of entity with limited liability to the owners and shareholders
OwnershipSole OwnershipMin 2 Partners Max 50 PartnersDesignated Partners
  • Min 2 Directors
  • Min 2 Shareholders
  • Max 15 Directors
  • Max 200 Shareholders

  • For One Person Company
  • 1 Director
  • 1 Nominee Director
  • Registration Time7-9 working days7-9 working days7-9 working days7-9 working days
    Promoter LiabilityUnlimited LiabilityUnlimited LiabilityLimited LiabilityLimited Liability
    Documentation
  • MSME
  • GST Registration
  • Partnership Deed
  • LLP Deed
  • Incorporation Certificate
  • MOA
  • AOA
  • Incorporation Certificate
  • Governance-Under Partnership ActLLP Act, 2008Under Companies Act,2013
    TransferabilityNon TransferableTransferable if registered under ROFTransferableTransferable
    Compliance RequirementsIncome tax filing if turnover is more than ₹.2.5 lakhsITR 5
  • Form 11
  • Form 8
  • ITR 5
  • ITR 6
  • MCA filing
  • Auditor's appointment
  • Why Vakilsearch

    Access To Experts

    We provide access to reliable professionals and coordinate with them to fulfil all your legal requirements. You can also track the progress on our online platform, at all times.

    Realistic Expectations

    By handling all the paperwork, we ensure a seamless interactive process with the government. We provide clarity on the incorporation process to set realistic expectations.

    300-Strong Team

    With a team of over 300 experienced business advisors and legal professionals, you are just a phone call away from the best in legal services.

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