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Updated on 11 Jul 2020    9.00 AM IST | 4 min read

What is Sole Proprietorship Business?

A business owned & managed by one person is known as Sole proprietorship business. It is one of the most popular businesses specifically started by small traders & merchants. Registration is not necessary in the case of sole proprietorship except GST registration. In sole proprietorship firm, all the profits & losses are handled by one person only i.e. the owner of the sole proprietorship firm. Therefore, it has unlimited liability. Sole proprietorship firm does not benefited with the feature of perpetual existence and has a minimal tax advantage.

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Eligibility Consultation

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Documents Required for Sole Proprietorship Registration in India

The documents required for sole proprietorship registration in India are as follows –

  1. Aadhaar card
  2. PAN card
  3. Proof of registered office
  4. Bank account

In order to run sole-proprietorship business smoothly, sole proprietor needs to obtain few registrations which are as follows –

  1. Registration as small medium enterprise under MSME act (Not compulsory)
  2. Shop and establishment act license (Not compulsory)
  3. GST registration (Mandatory)

Advantages of Sole Proprietorship Firm

The three important benefits of sole proprietorship are as follows –

  • Economical – Sole proprietorship is very economical as compared to other types of companies such as one person company or a private limited company. It is economical due to its minimal compliance requirements. It is also inexpensive in the long run. In the case of sole proprietorship, there is no need to hire an auditor which is also considered as one of the most important reason of choosing sole proprietorship business over others by small merchants & traders.
  • Easy to start – Any individual can easily start sole –proprietorship business as the procedure of starting a sole-proprietorship firm is not complicated. Any individual can start this business within 15 days of submitting PAN card, identity proof & address proof.
  • Minimal compliance – A sole-proprietorship firm gets identified by its government & tax registrations as it has minimal compliance requirements. The major compliances for sole proprietorship in India are as follows –
    1. GST returns
    2. Annual income tax return

How Finacbooks help with Sole Proprietorship Firm Registration in India?

Finacbooks is a leading Indian portal providing accounting, finance & taxation services to small businesses. We arehaving more than 10 years of experience helping individuals registering as sole proprietors and filing their annual tax returns at a least possible price. We will guide you through the entire process of Sole proprietorship registration. To avail the best deals on Sole proprietorship, kindly call us at 8800221252 or you can also e-mail us at info@finacbooks.com

Sole Proprietorship FAQ’S

Any individual with current account in the name of his business can start a sole proprietorship firm. In order to open a bank account, Shops & Establishment registration is required by bank.
Any individual can start a sole proprietorship business within 15 days. It is specifically started by small traders & merchants because of its cheap cost.
Yes, you can apply for sole proprietorship registration online with Finacbooks.
Yes, you can convert sole proprietorship firm into private limited company or partnership firm. The procedure is bit long but it is possible. Many sole proprietors convert their proprietorship firm into partnership firm or a private limited company at a later stage.

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