Sole Proprietorship Firm Registration in India

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Overview

Understanding Sole Proprietorship Firm Registration as a Business Structure

Sole proprietorship business can be started by a single person. It is the simplest form of business with minimum requirement, but the owner is personally liable to any form of risks and liabilities. A sole proprietor has to apply for Shop & Establishment Act and GST license (if applicable) under any Trade name that he wishes without going through the requirement of obtaining the name approvals subject to trademark issues, and the sole proprietor is ready to do business.

Benefits

What are the advantages of registering a business as a Sole Proprietorship Firm?

Lower Compliance Requirement

Sole proprietorship firm is the simplest one when it comes to registration and compliances in India as they are not regulated under any one law.

Easy to convert into other business type

One can start a business as a Sole proprietor initially and when the business expands, the sole proprietor can easily convert it into other business type.

Lower cost to start the business

Starting a partnership firm will involve significantly lesser fees compared to the One Person Company or Partnership firms and cost of running the proprietorship business is also relatively lesser.

Single ownership

Since there is only one owner in OPC, it will be easier to take decisions, start and manage the business which is not possible in other business types as more people are involved.

Online Registration

Documents required for registration of a Sole Proprietorship Firm

PAN & AADHAR Card

PAN & Aadhar Card of all directors Foreign nationals may provide passport

Address Proof

Bank Statement/Electricity Bill. Foreign nationals may provide passport

Identity Proof

Voter ID/ Passport/ Driving License of all directors

Photograph

Passport Size Photos of all directors

Business Address Proof

Electricity bill or Utility bill of the premises

Rent Agreement

Rent Agreement with the Building Owner

NOC From Owner

Declaration from owner for using the address

Other Basic Details

Few other details relating to KYC and background information

Online Registration

Register a Company in a few Easy Steps

  • Pick your Service that will suit you

  • Fill out the contact details form

  • Contact us to get the queries resolved (if any)

  • Make the payment to close the deal

  • Application for Name Approval

  • Receiving the documents

  • Register for DSC

  • Processing the documents

  • Filing the application for registration

  • Receive the GST Certificate, Shop & Establishment Act Certificate

Process

Process to Register a Company in India
  • Day 1 - 2
    • Review of documents and information provided
    • Checking Name availability
    • Name reservation application under SPICe
  • Day 3 - 4
    • Application for Digital Signature Certificate
    • Filing LLP registration application
    • Drafting of LLP Agreement & other required documents
  • Day 4 - 7

    Government processing time

  • Day 8 - 9
    • DIN allotment application
    • Application for PAN and TAN of LLP

What Is The Right Business Structure For You?

LLP vs. Private Limite Company vs. Partnership
Private Limited Company One Person Company Limited Liability
Partnership		 Partnership
Firm		 Proprietorship Firm
Act Companies Act, 2013 Companies Act, 2013 Limited Liability Partnership Act, 2008 Indian Partnership Act, 1932 No specified Act
Registration Requirement Mandatory Mandatory Mandatory Optional No
Number of members 2 – 200 Only 1 2 – Unlimited 2 – 50 Only 1
Separate Legal Entity Yes Yes Yes No No
Liability Protection Limited Limited Limited Unlimited Unlimited
Statutory Audit Mandatory Mandatory Dependent Not mandatory Not mandatory
Ownership Transferability Restricted No Yes No No
Uninterrupted Existence Yes Yes Yes No No
Foreign Participation Allowed Not Allowed Allowed Not Allowed Not Allowed
Tax Rates Moderate Moderate High High Low
Statutory Compliances High Moderate Moderate Less Less
Know More Know More Get Started Know More Know More

Frequently Asked Questions

Explore Sole Proprietorship Firm Registration
For Private Company registration in India, following requirements must be fulfilled:
1. Minimum 2 directors shall be appointed, out of which one must be a resident of India.
2. Minimum 2 shareholders are required for this registration. Here, an individual may become shareholder and director at the same time.
3. A place of business in India must be provided as a registered office address.
During the registration, a minimum of INR 1 Lakh should be provided as an authorized capital. A minimum paid-up capital requirement is eliminated as a part of Government’s initiative to simplify the business registration in India. However, each shareholder must subscribe at least 1 share for the registration to introduce the sufficient amount for running the business.
The name of a company should be formulated as mentioned above. The applicants can provide the maximum of 2 names with their preference order under RUN form. The applicant should comply with the provisions of the Act or regulations. The registrar may ask to re-submit the application with a different name if names do not fall under the criteria of uniqueness, relevancy or do not fulfill other requirements.
Any natural person above the age of 18 years can become the director in the company after procuring Director Identification Number (DIN). And since there are no specific criteria provided in terms of citizenship or residency, a foreign national can also become a director. The application of DIN Allotment is now merged with the application for the formation of a company subject to a limit of maximum 3 DIN.
Director Identification Number is a unique number assigned by the Ministry of Corporate Affairs to Individuals on whose name the application is made, allowing an individual to be a Director in any Company or Designated Partner in an LLP.