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Proprietorship (F)

Proprietor

The sole ownership is the most established, least difficult, and most regular type of business entity. It is a business possessed by a person. For tax and legitimate liability purposes, the proprietor and the business are indeed the very same. The owner is not a different entity for taxation purposes. Note that the profit of the business is exhausted at the individual level, regardless of whether they are quite money. For risk purposes, the individual and the business are additionally indeed the very same. In this way, lawful inquirers can seek after the individual property of the owner and not just the advantages utilized in the business.

Maybe the best favorable position of this type of business is its effortlessness and ease. You are not required to document with the government, nor are any lawful sanction required. The sole ownership type of business has different favorable circumstances:

  1. Control:- There is no need to seek any approval or consent from any partner and complete control in the business.
  2. Low Cost:- There is no Legal Registration for running the business ie no Govt. Fee to pay.
  3. Privacy:- There are no documents that are in the public domain.
  4. Quick Decision:- Sole proprietorship business know for their quick effective decision
  5. Minimum Reporting:- Propertitor ship has no requirement to file Annuls details of the business to the Govt.
  6. Tax Reform:- For proprietorship has simplified tax Reform.
  1. Small Size
  2. Lack of Talent and professional skils
  3. Unlimited Liabilities
  4. Lower Growth
  5. Short of Capital
  6. Risk of a wrong decision
  7. Limited scope of the employees

For Proprietorship, there is no legal registration but on the hand, to run the business some of the registration-required depend on their business purposes.

  1. Registration under Shops & Etablishements Act, and certificate issued by municipal authorities. ( Mostly Required )
  2. GST Registration ( Mostly Required), If Turnover Exceed 20, lacs in Case of Services & 40 Lacs in case of Goods Supplied.)
  3. IEC,   Import & Export Code ( For Proprietor, who involve in Import and Export Business).
  4. As other time to time registration required to depend on the scale of business etc.

All about Proprietorship.

Proprietor

The sole ownership is the most established, least difficult, and most regular type of business entity. It is a business possessed by a person. For tax and legitimate liability purposes, the proprietor and the business are indeed the very same. The owner is not a different entity for taxation purposes. Note that the profit of the business is exhausted at the individual level, regardless of whether they are quite money. For risk purposes, the individual and the business are additionally indeed the very same. In this way, lawful inquirers can seek after the individual property of the owner and not just the advantages utilized in the business.

Maybe the best favorable position of this type of business is its effortlessness and ease. You are not required to document with the government, nor are any lawful sanction required. The sole ownership type of business has different favorable circumstances:

 

The proprietor or owner is in finished control of business choices and decisions.

The income generated through operations can be directed into the proprietor’s pocket or reinvested as he or she sees fit.

Profits flow directly to the proprietor’s personal tax return; they are not subject to the second level of taxation. In other words, profits from the business will not be taxed at the business level.

The business can be dissolved as easily and informally as it was begun.

These advantages account for the widespread adoption of the sole proprietorship in India. Any person who wants to set up shop and begin dealing with customers can get right to it, in most cases without the intervention of government bureaucrats or lawyers.

Disadvantages of the Sole Proprietorship:

This legal form of organization, however, has disadvantages:

The amount of capital available to the business is limited to the owner’s personal funds and whatever funds can be borrowed. This disadvantage limits the potential size of the business, no matter how attractive or popular its product or service

Sole owners have the boundless risk for all obligations and lawful decisions brought about over the span of the business. Along these lines, an item risk claim by a client won’t be made against the business but instead against the proprietor.

The business will most likely be unable to draw in high-bore workers whose objectives incorporate a portion of business ownership. Sharing the advantages of ownership, other than basic benefit-sharing, would require an adjustment in the legal form of the business.

Some employee benefits, such as the owner’s life, disability, and medical insurance premiums, may not be deductible or maybe only partially deductible from taxable income.

 

Is it necessary to register the Sole Proprietorship firm in India? : No registration is required for a sole proprietorship. You simply have to open a bank account with the name & style you want to work. But if you are liable for GST, then you have to obtain GST registration. Further, for a sole proprietorship, no separate income tax PAN is required. The PAN of the proprietor will be the PAN of the firm and the proprietor will have to file an income tax return in his personal name.

Basic

INR 1,500/-

One Time Fee

  • GST Registration
  • MSME Registration
  • Bank A/c.

Service Provide Within 7 Days

Standard

INR 11,999/-

One Time Fee

  • GST Registration
  • Shop & Establishment Registration
  • MSME Registration
  • Trade Mark Registration
  • Logo Design
  • Opening Bank A/c.

Service Provide Within 15 Days

Premium

INR 11,999/-

Yearly Fee

  • Yearly GST Compliances
  • Income Tax Return

Services Provided Before the Due Date

Frequently Asked Questions

  • Proprietorship has low cost of compliance business as compare to other business structure.
  • Proprietorship business has very simple in structure.
  • Proprietorship are exempt in registration of every state.
  • Paper work not required for running business in sole Proprietorship.
  • Proprietorship business has unlimited liabilities as compare to other corporation
  • Proprietorship business income tax assess on personal income basis.

No, Individual PAN is applicable for run the business under sole proprietorship and income earn through proprietorship will consider personal income for the filing of income tax return.

Sole proprietor are personal liable for everything done under business,  While PVT & Limited Company and Limited Liabilities  partnerships gain the benefit of limited liability, If you cannot pay your debts, your personal assets . For this reason, you should be careful in how you set up your proprietorship.

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