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First of all thanks to Razorpay Rize for providing all the support. Special mention to CS ketki Mirje. She was very cooperative throughout the Process

Nayan Mishra

Zillout Social

Just got my company incorporated through Razorpay Rize and had a really good experience. All my queries were handled proactively and would recommend going with Razorpay Rize if you're looking to get incorporated.

Anup Totla

DashHunt Education

Process is really good, I've already registered 2 companies with Razorpay and it's been a great experience.

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Kahanii Collective

Everything was so so soo smooth and quick. the team you partnered with was very helpful and it was something we did not expect at such low cost. I have referred razorpay to one of my friend and he will also be signing up soon. thanks to the whole team.

Archit Vats

Muzzari Global

Process was really fast and effortless, really happy with the whole team and will also go ahead with the same vendor post compliances.

Mayank Sharma

Rapparel Solutions

Big news!! Zoync Technologies has now officially Incorporated as a private limited company under the companies Act 2013. We extend our heartfelt thanks to Razorpay Rize for their invaluable assistance in ensuring a smooth registration process. Their support has been instrumental in achieving this milestone!

Akshay Sharma

Zoync Technologies

Thank you #Razorpayrize for getting my OPC incorporated. Patient and persistent and always helpful despite the issues with the portal. Thank you again. #Razorpayrizeincorporation

Krishna

Tarunilakshmi Ventures

First of all thanks to Razorpay Rize for providing all the support. Special mention to CS ketki Mirje. She was very cooperative throughout the Process

Nayan Mishra

Zillout Social

Anup Totla

DashHunt Education

Process is really good, I've already registered 2 companies with Razorpay and it's been a great experience.

Shalinee Gupta

Kahanii Collective

Archit Vats

Muzzari Global

Process was really fast and effortless, really happy with the whole team and will also go ahead with the same vendor post compliances.

Mayank Sharma

Rapparel Solutions

Akshay Sharma

Zoync Technologies

Thank you #Razorpayrize for getting my OPC incorporated. Patient and persistent and always helpful despite the issues with the portal. Thank you again. #Razorpayrizeincorporation

Krishna

Tarunilakshmi Ventures

First of all thanks to Razorpay Rize for providing all the support. Special mention to CS ketki Mirje. She was very cooperative throughout the Process

Nayan Mishra

Zillout Social

Anup Totla

DashHunt Education

Process is really good, I've already registered 2 companies with Razorpay and it's been a great experience.

Shalinee Gupta

Kahanii Collective

Archit Vats

Muzzari Global

Process was really fast and effortless, really happy with the whole team and will also go ahead with the same vendor post compliances.

Mayank Sharma

Rapparel Solutions

Akshay Sharma

Zoync Technologies

Thank you #Razorpayrize for getting my OPC incorporated. Patient and persistent and always helpful despite the issues with the portal. Thank you again. #Razorpayrizeincorporation

Krishna

Tarunilakshmi Ventures

Sole Proprietorship Firm Registration in India

Name: Sole Proprietorship Firm Registration Online in India: Process, Fees & Documents Required - Razorpay Rize
Brand: Razorpay Rize
Rating: 4.8 (45 reviews)

In a Sole Proprietorship, there is no separate legal entity. As a single owner, you bear full responsibility and liability for managing the business. This form of business structure comes with its list of advantages and disadvantages. Small businesses mainly prefer Sole Proprietorship due to its simple and accessible registration process.

Contents

Documents required for registration

Incorporation Process

Compliances & Requirements

Advantages & Disadvantages

Registration Number

Registration Time

Fees

Checklist for Registration

Frequently Asked Questions

Documents Required to Register a Sole Proprietorship

As an individual or a firm, Sole Proprietorship registration requires the below-mentioned documents.

Identity Proof
a. Passport/ Aadhar card/ Voter ID/ Driver's License of the Owner
b. PAN card
Address Proof
Utility bills or Bank Statements
Proof of Registered Office
a. Ownership of Property- Any utility bill like an electricity bill or corporation tax receipt not later than 30 days.
b. Right to use the Property- Rental Agreement or No Objection Certificate (NOC) from the owner.

Sole Proprietorship Registration Process

Sole Proprietorships often operate under your legal name, and there may be no formal registration requirement to start and run a business as a sole proprietor. However, these are a few general steps to successfully start this type of business structure.

Apply for a PAN & TAN of the business.
Choose a business name and the nature of the business.
Open a bank account to manage all the business-related transactions.
You don’t require legal registration to start a Sole Proprietorship firm, but specific essential registrations or licenses must be obtained for conducting the business.
‍
Here are the basic registrations needed for a Sole Proprietorship:
a. Registration Certificate under the Shop and Establishment Act of the state where the business is located.
b. GST Registration if the business turnover exceeds Rs. 40 Lakhs (for goods) and Rs. 20 Lakhs (for services).
c. Micro, Small, and Medium Enterprise (MSME) Registration under the MSME Act, though it is not mandatory.

Compliances for Sole Proprietorship

For Owner

There is no minimum or maximum number of owners for a Sole Proprietorship because, by definition, it is owned and operated by a single owner.

For Sole Proprietorship

File Income Tax Returns through forms ITR-3 or ITR-4.
File monthly and quarterly GST returns if applicable.
File TDS forms every quarter if applicable.
Apply for Audit if the annual turnover exceeds Rs. 1 Crore (for commerce-related businesses) and Rs. 50 Lakhs (for Professional & Consultancy based services).

In addition to the above, various other compliance requirements may apply to the Proprietorship Firm based on industry and location.

Minimum Capital Requirement

There is no minimum capital requirement for Sole Proprietorship. As a sole owner, you can use your funds and resources to start and operate the business.

Tax Rates

Since Sole Proprietorship is not a separate legal entity, your income as a sole proprietor will be taxed as personal income.

The following tax rate applies to a Sole Proprietorship for FY 2023-24:

Net Income

Tax Rate

Up to Rs.2,50,000

N/A

Rs. 2,50,001 to Rs. 5,00,000

Rs. 5,00,001 to Rs. 7,50,000

10%

Rs. 7,50,001 to Rs, 10,000

15%

Rs. 10,0001 to Rs. 12,500

20%

Rs. 12,501 to Rs. 15,000

25%

Above Rs. 15,000

30%

You can also opt for an Alternate Tax Regime, which further provides flexibility and different tax rates for respective income slabs. In addition to the Income Tax amount, you must also pay Surcharge and Health and Education Cess, which can vary for each taxable income slab.

Advantages and Disadvantages of Sole Proprietorship

Advantages

The pass-through tax advantage
Your business isn't taxed separately as a sole proprietor. This practice is called “pass-through” taxing since your profits from the business go directly to you. This demonstrates a specialized tax status, which effectively dissolves the burden of double taxation, i.e., your income isn’t subjected separately to corporate & individual taxes.
Ease of creation
There is no formal incorporation or dissolution process for Sole Proprietorship. The process is economical as it is relatively less expensive to start than any other type of incorporation.
Fewer compliances
Minimum compliance must be adhered to to get a company registered as a Sole Proprietorship firm. As most proprietorships are only registered with government departments like Income Tax &GST, your compliance burden is lower and manageable.
Undivided authority
You are allowed to make all business decisions in a Proprietorship. There are no partners, shareholders, or directors. Hence, you can efficiently operate this business with minimal documents and consent requirements.

Disadvantages

Unlimited liability
You are personally liable for all business transactions if any loss occurs. Unlike a company or LLP, a Proprietorship cannot have some tax deductions, which may increase the tax liability.
No perpetual succession
There is no endless succession, which means it might end if you, as a single owner, choose not to operate the business.
Challenges in raising funds
This business structure relies solely on your savings, borrowings, and credit history. In this type, you can only raise funds from banks through loans, Overdrafts, etc.
It is also difficult to raise equity funds as this business entity does not allow for external shareholding.
Limited growth
This type of entity has numerous restrictions related to fundraising and business continuity. This makes it difficult to expand or scale in the future.

Sole Proprietorship Registration Time

There is no legal or formal process to register a Sole Proprietorship. You can, however, consider registering your Sole Proprietorship with Micro, Small, and Medium Enterprises (MSME) or Goods and Services Tax (GST) for regulatory purposes. It takes approximately following days to register with these regulatory authorities-

MSME Registration: 2-4 Working Days
GST Registration: 7-10 Working Days

Things that Delay a Registration Process

Common Causes of Registration Delays:

Insufficient or Inaccurate Documentation
Requirement of Extra Regulatory Approvals or Permits
Slower Verification Procedures
Payment Processing Delays

Sole Proprietorship Registration Fees

The registration charges for a Sole Proprietorship can span from Rs. 500 to Rs. 2,000. This cost includes essential registrations and licenses like GST, Shop and Establishment, or MSME. *The cost can vary depending on jurisdiction, government, and professional fees.

Checklist for Registration

Choose a unique name for your firm.

Select a nature of business.

Obtain PAN and TAN for the Firm.

Apply for GST Registration.

Apply for MSME Registration, if applicable.

Apply for Shop and Establishment License, if applicable.

Open a Current Account.

Stay up-to-date with the latest regulations.

FAQs

Is it mandatory to register my business as a Sole Proprietorship?

It is not mandatory to register your business as a Sole Proprietorship in India. Operating as a Sole Proprietorship is one of the simplest forms of business structure, and it does not require formal registration with government authorities.

How can I register my Proprietorship firm with GST authority?

GST stands for Goods and Services Tax, a value-added tax levied on the consumption of goods and services.You can register your firm through the following steps:

Visit the GST Portal.‍
Click on “Register Now”.
Fill “Part A” form.
Fill out “Part B” of the said form. Submit your business details and upload the requisite documents.
Once verified and approved, you will receive a GST Certificate.
This GST Certificate will have a GSTIN- a 15-digit state-wise number for business purposes.

Should I register my Sole Proprietorship under the MSME Act?

MSME registration stands for Micro, Small, and Medium Enterprises registration, launched to provide various benefits and support to businesses falling within the defined categories. You can register your business with the MSME Act to avail of such benefits. It offers several advantages to registered businesses, including-

Access to government schemes and incentives,
Access to low-interest credit and loans,
Subsidies and quality certifications,
Reimbursement of ISO certification expenses, and more.

How can I select a name for my Sole Proprietorship Firm?

Here’s a simple guide to choosing your business name.

Ensure the name is unique and not already in use.
Choose a name that reflects the nature of your business.
Check local naming regulations and restrictions.
Avoid overly generic or familiar terms.

Our “Company Name Search” feature also helps you check your business name through multiple databases and ensures it is 100% unique and compliant.

Searching for a company name?

Check company name availability using our powerful name search tool.

Are there any restrictions on the types of businesses that can operate as Sole Proprietorships?

Businesses pertaining to activities, such as banking, insurance, finance, lending, defence, and telecommunication, will face certain operational restrictions and require additional regulatory approvals/ licenses.

What is the difference between a Sole Proprietorship and a One Person Company (OPC)?

The significant difference between Sole Proprietorship and a One Person Company is the separate legal existence of the business. An OPC offers limited liability, perpetual succession, and fundraising opportunities, while a Sole Proprietorship doesn’t provide these features.
Both structures have their advantages and disadvantages, and the choice should align with the specific needs and circumstances of your business.

How easy is it to close a Sole Proprietorship business?

Since Proprietorship doesn’t involve compulsory legal registration, the dissolution of such a firm is relatively easy.

Pay off all the debts and liabilities.
Cancel the GST registration, PAN, TAN, and Shop and Establishment Registration, if any.
Surrender other licenses and terminate the agreements.
Close the business bank account.

Can I convert my Sole Proprietorship firm to some other business structure?

Sole Proprietorship doesn’t include formal registration, making it easier to transition and start a new registration with entities like Private Limited Company, One Person Company, or LLP. The registration process can vary from one type to another. You can find detailed information about each structure's registration process on their respective pages.

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Smooth onboarding, seamless incorporation and a wonderful community. Thanks to the #razorpayrize team! #rizeincorporation

Basanth Verma

Shop EG

shopeg.in

Exciting news! Incorporation of our company, FoxSell, with Razorpay Rize was extremely smooth and straightforward. We highly recommend them. Thank you Razorpay Rize for making it easy to set up our business in India.
@foxsellapp
#razorpayrize #rizeincorporation

Prakhar Shrivastava

FoxSell

foxsell.app

We would recommend Razorpay Rize incorporation services to any founder without a second doubt. The process was beyond efficient and show's razorpay founder's commitment and vision to truly help entrepreneur's and early stage startups to get them incorporated with ease. If you wanna get incorporated, pick them. Thanks for the help Razorpay.
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#entrepreneur #tbsmagazine #rize #razorpay #feedback

TBS Magazine

Hey, Guys!
We just got incorporated yesterday.
Thanks to Rize team for all the Support.
It was a wonderful experience.
CHEERS 🥂
#entrepreneur #tbsmagazine #rize #razorpay #feedback

Nayan Mishra

Zillout

https://zillout.com/

Smooth onboarding, seamless incorporation and a wonderful community. Thanks to the #razorpayrize team! #rizeincorporation

Basanth Verma

Shop EG

shopeg.in

Prakhar Shrivastava

FoxSell

foxsell.app

TBS Magazine

Hey, Guys!
We just got incorporated yesterday.
Thanks to Rize team for all the Support.
It was a wonderful experience.
CHEERS 🥂
#entrepreneur #tbsmagazine #rize #razorpay #feedback

Nayan Mishra

Zillout

https://zillout.com/