Sole Proprietorship is one of the oldest and widely practiced types of business in India. The reason why Sole Proprietorship is the most widely practiced in India is because it is the easiest type of business to start with. There is no specified registration process of Proprietorship firm. Proprietorship firm does not have its own PAN Card. Certain licenses and registrations may be required depending upon the nature of business of Proprietorship. In this article we will discuss the process to start Proprietorship Concern.
Sole Proprietorship Registration Process
As discussed above, there is no specified registration process for Sole Proprietorship firm. A Proprietorship firm is said to be in existence when it obtains business license for carrying on business or opens a bank account in its name. As per RBI’s guidelines for KYC, any two of the below mentioned documents are required to open bank account of a Proprietorship firm.
- PAN Card of Proprietor (Compulsory)
- Shop and Establishment License
- VAT Registration Certificate
- Electricity, Water or Telephone Bill in the name of Proprietorship firm
- Service Tax Registration Certificate of Proprietorship firm
- Professional Tax Registration Certificate of Proprietorship firm
- Importer Exporter Code (IEC) issued by DGFT
- License issued by registering authority such as Institute of Chartered Accountants or Institute of Company Secretaries of India.
- Registration document issued by Central Government or State Government in the name of Proprietorship firm.
- Certificate from Chartered Accountant that the Proprietorship is in existence.
With the help of above mentioned documents a Proprietor can open his bank account with Bank. Some of the above referred documents are such that those will be available only after the Proprietorship has a Bank Account number. It is therefore advisable to read the list of documents carefully.
A proprietorship might not be an ideal business form for you as sole proprietorship has many disadvantages. Contact MyEfilings, to determine whether a sole proprietorship is the right business structure for you.