Rize.Start
What’s Included?
.svg)
View our wall of love
In a Sole Proprietorship, there is no separate legal entity. As a single owner, you bear full responsibility and liability for managing the business. This form of business structure comes with its list of advantages and disadvantages. Small businesses mainly prefer Sole Proprietorship due to its simple and accessible registration process.
As an individual or a firm, Sole Proprietorship registration requires the below-mentioned documents.
Sole Proprietorships often operate under your legal name, and there may be no formal registration requirement to start and run a business as a sole proprietor. However, these are a few general steps to successfully start this type of business structure.
There is no minimum or maximum number of owners for a Sole Proprietorship because, by definition, it is owned and operated by a single owner.
In addition to the above, various other compliance requirements may apply to the Proprietorship Firm based on industry and location.
Minimum Capital Requirement
There is no minimum capital requirement for Sole Proprietorship. As a sole owner, you can use your funds and resources to start and operate the business.
Tax Rates
Since Sole Proprietorship is not a separate legal entity, your income as a sole proprietor will be taxed as personal income.
The following tax rate applies to a Sole Proprietorship for FY 2023-24:
You can also opt for an Alternate Tax Regime, which further provides flexibility and different tax rates for respective income slabs. In addition to the Income Tax amount, you must also pay Surcharge and Health and Education Cess, which can vary for each taxable income slab.
There is no legal or formal process to register a Sole Proprietorship. You can, however, consider registering your Sole Proprietorship with Micro, Small, and Medium Enterprises (MSME) or Goods and Services Tax (GST) for regulatory purposes. It takes approximately following days to register with these regulatory authorities-
Common Causes of Registration Delays:
The registration charges for a Sole Proprietorship can span from Rs. 500 to Rs. 2,000. This cost includes essential registrations and licenses like GST, Shop and Establishment, or MSME. *The cost can vary depending on jurisdiction, government, and professional fees.
It is not mandatory to register your business as a Sole Proprietorship in India. Operating as a Sole Proprietorship is one of the simplest forms of business structure, and it does not require formal registration with government authorities.
GST stands for Goods and Services Tax, a value-added tax levied on the consumption of goods and services.You can register your firm through the following steps:
MSME registration stands for Micro, Small, and Medium Enterprises registration, launched to provide various benefits and support to businesses falling within the defined categories. You can register your business with the MSME Act to avail of such benefits. It offers several advantages to registered businesses, including-
Here’s a simple guide to choosing your business name.
Our “Company Name Search” feature also helps you check your business name through multiple databases and ensures it is 100% unique and compliant.
Searching for a company name?
Check company name availability using our powerful name search tool.
Businesses pertaining to activities, such as banking, insurance, finance, lending, defence, and telecommunication, will face certain operational restrictions and require additional regulatory approvals/ licenses.
The significant difference between Sole Proprietorship and a One Person Company is the separate legal existence of the business. An OPC offers limited liability, perpetual succession, and fundraising opportunities, while a Sole Proprietorship doesn’t provide these features.
Both structures have their advantages and disadvantages, and the choice should align with the specific needs and circumstances of your business.
Since Proprietorship doesn’t involve compulsory legal registration, the dissolution of such a firm is relatively easy.
Sole Proprietorship doesn’t include formal registration, making it easier to transition and start a new registration with entities like Private Limited Company, One Person Company, or LLP. The registration process can vary from one type to another. You can find detailed information about each structure's registration process on their respective pages.
Rize.Start
Hassle free company registration through Razorpay Rize
Make your business ready to scale. Become an incorporated company through Razorpay Rize.
View our wall of love
.svg)
