What is a proprietorship firm?
Majorly used by the small and the medium sized businesses, proprietorship forms are started and managed by a single person. They are easy to start and do not have much regulatory compliances.
What are the features of the proprietorship firm?
- A single individual runs the entire the company.
- The individual gains the complete control over all the proceedings of the company.
- The person is liable for all the debts incurred by the company.
- The sole proprietorship does not have much complex filing systems.
- Sole proprietorships are easy to start up.
Why should you register as a proprietorship firm?
- Proprietorship firms that make less turnover have the facility of paying lesser tax returns
- Even if you wish to close the proprietorship, you will find it easy to close, as both the firm and the proprietor are considered same under law
- The proprietorship is registered and managed by a single person
Some things you should know
Ease of start
The time taken to start a proprietorship is less when compared to the other companies. If you have the authentic PAN card and the address proof with you, you can easily apply for a proprietorship under your name.
Inexpensive
As mentioned, since there are very minimal regulatory compliances, you do not have to worry about the expenses that you have to incur while forming a proprietorship firm. No external help is required for starting the business.
Compliances
Proprietorship firms are regulated by the government under which they are regulated. As the jurisdiction for the firm is not diverse, you can see that the person does not have to go through a lot of complex compliances to start the business.
Documents required
- PAN card of the sole proprietor
- Address and identity proof for the sole proprietor
- KYC documents
- Rental agreement between the proprietor and the landlord for the place of operation of the proprietorship
Process of registration
- Get consultation for starting of the proprietorship
- Apply for the tax registration under the proprietorship name
- File the documents for the registration of the proprietorship with the authorities
- Open a bank account to handle the finances of the proprietorship
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