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Table of Content
Overview
Worried about the ins and outs of the process of registering your Proprietorship?
YOU CAN NOW REGISTER YOUR FIRM AT AFFORDABLE PRICES!
Setting your Proprietorship is now made easy with Company Adda. This type of company is owned, controlled and operated by a single individual who is the sole beneficiary of all profits or loss, and responsible for all risks. It is usually a specialised service such as a hair salon, a beauty parlour, or a small retail shop. Want to open up your Proprietorship? We will take care of all your legal formalities like GST, Tax, PAN and all other documentation required by the Indian Government. All you will have to do is to contact us and start the company of your dreams.
Frequently Asked Question
There is no such requirement of prior registration for proprietorship firms.
A sole proprietor is the absolute owner of a Sole Proprietorship Business. Any person who is above 18 years of age and who is otherwise capable of entering into a lawful contract is eligible to start a business as a proprietorship. The option to create a proprietorship is available to Indian Citizens only, and Foreign Citizens are strictly not allowed to set up or operate a proprietorship firm. However, an NRI and OCI are permitted to establish proprietorship firms subject to no repatriation of their profits.
There is no certificate of registration or incorporation for proprietorship business as such. The legal identity of proprietorship as an entity is determined through various other registration or licenses obtained in the proprietorship firm's name on a case to case basis. Similarly, each specific registration shall result in issuing a certificate of registration, for example, GST Certificate, MSME Registration Certificate, Tan Allotment Letter, etc.
Sole proprietors may not always have the necessary technical skills to facilitate or advance his business venture. The sole liability clause is also a major disadvantage.
Both the proprietorship and one person company is a venture owned by a single owner; the proprietors are liable for all the business's debts, whereas the OPC protects limited liability to its shareholders.
Ease of formation is the most significant feature of the sole proprietorship form of business. There is no prior registration required to start a proprietorship firm. Similarly, after starting the business, no law makes it mandatory to register the sole proprietorship. No agreement, deed, or documents are to be prepared for creating a proprietorship, and the firm's registration is also not required.
As there is no difference between the business and its owner in the case of proprietorship, Unlike corporations, sole proprietorships are not treated separately for income tax purposes. This means that any profit derived from your sole proprietorship is treated as your income and is accounted for on your tax return. Any such income is taxed to you in the year it was received or accrued to you. The business income shall be shown as separate income in the income tax return of the proprietor.
Yes. Unlike other incorporated business forms, the liability of the proprietor is unlimited to the sole proprietorship. The proprietor's unlimited liability means that debt collectors can come after your assets, homes, cars, etc. For this reason alone, you should be extremely cautious while setting up a sole proprietorship.
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