Registration of Proprietorship

Sole Proprietor is a single man organization, wherein the proprietor is vested with all the rights and powers, similarly he alone is liable for all kinds of liabilities what so ever, with no limitation. In the eventuality of defaults by the proprietorship the personal properties of the proprietor is attached to meet the liabilities. There is no specific law which regulates this kind of the business.

Since the proprietorship is itself not distinguishable from its owner hence there is no registration or approval is required to start a proprietorship business. However following are the registrations which is needed based on the situation of the firm

• Registration under Shops and Establishment Act : This is state specific requirement, in some states it is mandatory and in some it is optional, for example in the Delhi NCT it is optional
• Local Municipality Registration : This kinds of registration is mandated by some of the municipalities and applies to the firms operating in the territorial jurisdiction of the municipality.
• Sales Tax (VAT) Registration : This is a tax on sale of goods within the state which is governed by the respective vat act of the state.
• Central Sales Tax Registration : This is a tax on Sale of goods between the states, which is governed by the central sales tax act
• Service Tax Registration : This is a tax on the services provided by the proprietor apart from the negative list of service.
• Import Export Code : This is also known as IEC, and is pre-requisite before the proprietorship ventures in to any import or export
• Trade Mark Registration : Brand Name, Logo, Slogan, Label etc.; are intellectual properties which acquires value over a period of time and it is advisable to protect them under as trade mark
• Provident Fund Registration : The moment number of employees exceeds 20 the proprietor is required to get itself registered with the regional office of the Provident Funds Organization. The contribution rate is 12% each from employee as well as employer
• Employee State Insurance Corporation (ESIC) Registration : every organization including the proprietorship concerns employing more than 10 employees having salary more than 15000/- is required to get themselves registered with the concerned Regional office of the ESIC, the contribution to the ESIC is 6.5% wherein 4.75% is contributed by the employer and 1.75% is to be contributed by the employee
• Other Need Based Registration : the firm may be required to get themselves registered into various other departments like excise, customs, SSI etc ;