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Proprietorship Firm

Proprietorship Firm registration starting from Rs.999/-

Proprietorship Firm Registration

Introduction of Proprietorship Firm Registration

Proprietorship firm registration means a firm which is owned and control by sole member. There is no separate legal entity between the sole proprietor and the business property. Sole member is the only owner of the property who enjoys all the profits and suffers all the losses of the firm. The liability of the sole member is unlimited which means when business profits are not sufficient for set off the losses of the business then the personal property of the sole owner should be used for setting off the losses. In proprietorship firm registration, there is a minimum requirement of regulatory compliance for starting and operating.

Sole member can also delegate its authority to another person as an employee but shall not delegate the singing authority on legal documents of the firm to any other person.

If the sales turnover of the proprietorship firm is exceeding Rs. 1 crore (in case of a business) or if gross receipts of proprietorship are exceeded Rs. 50 lakh (in case of the profession) then tax audit is mandatory.

Features of proprietorship firm :
  • One Person required as single entrepreneur.
  • Single owner of the business.
  • Easy to start and easy to close.
  • Complete control.
  • Nominal cost of formation and compliances.

Basic Features to Read before starting Proprietorship Firm Registration:

1. Bank Account Opening for Proprietorship

  • Procedure for the opening bank account of Proprietorship Firm.
  • Documents such as MSME, BRN No., GST Registration Certificate, PAN Card, Aadhar Card, Passport Size Photo, Rent Agreement, Electricity Bill are required for an opening bank account.
  • And as per the Reserve Bank of India Know Your Customer (KYC) norms have also complied.

2.  Advantages & disadvantages:


  • Proprietorship is easy to setup.
  • There is no legal entity between a sole proprietorship and business property.
  • There is no sharing of profit & loss.
  • Freedom of decision making.
  • Lower capital is required.


  • There is unlimited liability.
  • There is difficulty in increasing investment.

3. Proprietorship Firm Registration Setup:

Procedure for the startup of proprietorship firm Registration

Documents required for setting up the proprietorship firm registration are-

  • PAN card,
  • Name of business,
  • Current account in the name of proprietorship in bank,
  • Business address proof Bill required,
  • The license under Shop Act.
  • To start a proprietorship firm it is necessary to register under the Shop Act. You required a location to start a business
proprietorship firm registration
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1. What are the benefits of sole proprietorship?

Ans. Sole proprietorship is easy to setup. Sole proprietorship there is minimum requirement of regulatory compliances as compare to other business. There is no need to file annual report and financial statement with MCA.

2. How many minimum capital required to start a sole proprietor?

Ans. There is no minimum capital required to start a sole proprietorship. An owner can invest according to his requirement.

3. Is audit is required in sole proprietor?

Ans. In proprietorship if sales turnover of proprietorship firm is exceed Rs.1crore (in case of business) or if gross receipts of proprietorship is exceed Rs.50 Lac. (In case of individual) then tax audit is mandatory.

4. Can proprietorship firm convert into partnership firm?

Ans. Yes a proprietorship firm is convert into partnership firm. For conversion proprietorship into partnership firstly we dissolve the proprietorship firm.

5. How many people are required to start a sole proprietor?

Ans. There is only one person required for start a sole proprietor.

6. How sole proprietor firm can dissolve?

Ans. A sole proprietorship is a single person business entity, for dissolving the proprietorship firm firstly you should pay all the debts and maintain records for tax filling purpose.

7. What is annual compliances for sole proprietorship?

Ans. Like other companies which are register under MCA, the sole proprietorship firm are not required to file annual report and financial statement with MCA.

8. Is GST registration is mandatory for sole proprietorship?

Ans.  If sole proprietorship has threshold limit than GST registration  is mandatory for sole proprietorship.

9. Does sole proprietorship need to be register in India?

Ans. You don’t need to register your sole proprietorship in India. But in order to receive payments in the name of the business, you need to open a current account in bank. For this, you will need proof of existence of the Firm, and the address proof.
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Proprietorship Registration
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Proprietorship Registration
GST Registration
1st Year Income tax return Filing
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Proprietorship Registration
GST Registration
1st Year Income tax return Filing
12 Months GST Filing
1st Year Accounting in Tally ERP 9
TDS return filing
Book Keeping
Drafting of Balance Sheet

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