Proprietorship
Proprietorship Registration
A Sole Proprietorship is one of the oldest and simplest business structures in India. It is owned, managed, and controlled by a single individual, making it an ideal choice for small businesses, freelancers, and solo entrepreneurs. With minimal compliance requirements, starting a proprietorship is quick and hassle-free.
Since the proprietor and the business are legally the same entity, a proprietorship cannot have partners or shareholders. However, it does not provide limited liability protection, meaning the proprietor is personally responsible for all business debts and obligations.
Compliances for Proprietorship
1. Income Tax Filing
- The proprietor must file a personal income tax return using ITR-3 or ITR-4, depending on the nature of the business income.
- Business income must be declared in these tax forms as per income tax regulations.
2. GST Return Filing (If applicable)
- If the proprietorship is GST-registered, monthly or quarterly GST returns must be filed, depending on the tax scheme under which the business is registered.
3. TDS Returns (If applicable)
- If the proprietorship hires employees or makes purchases above a specified limit, Tax Deducted at Source (TDS) must be deducted and TDS returns must be filed quarterly.
4. Other Industry-Specific Compliances
- Depending on the business industry and location, additional licenses and regulations may be applicable, such as:
- Shops & Establishment Act Registration
- Professional Tax Registration
- MSME (Udyam) Registration for small businesses
Documents Required for Proprietorship Registration
