What are the Reasons to Apply for Sole Proprietorship Registration?
A sole proprietorship is one person’s space as it’s a kind of business that has not been registered as a business entity. It is owned and managed by only one person. These sole proprietorship’s are one of the most common kinds of business in our country and are also on the rise. These are used as a form of micro or small businesses form. The sole proprietorship businesses are often run or operated in an unorganized sector. In this article, we will discuss what are the reason to apply for sole proprietorship registration.
The kind of business is quite easy to start as it has minimal regulatory compliance requisites for starting as we all for operating. But once the start-up has been established and the start-up phase has been completed, it doesn’t offer the promoter any such significant benefits like the limited liability partnership or any sort of corporate status, same with being a separate legal entity that is independent of its existence. But with no transferability or perpetual existence which are all quite desirable features to have in a business. Hence, the sole proprietorship Registration is recommended but only for the unorganized and small type of business that shall remain small and also have most likely a limited time period of its existence.
By the law, the Indian government has not provided any mechanism for the sole proprietorship registration as such so their business must be rather established via tax registrations or via other business Registrations that would require to be as per the rules and regulations.
For example, GST registration can be taken in the name of the sole proprietorship for the establishment of the sole proprietorship. Now all the Registrations shall be in the name of the proprietor making him or her personally liable for all of the liabilities of the Proprietorship.
What are the reasons to Apply for Sole Proprietorship Firm Registration?
- Easy to Start: – A sole proprietorship is easy to start a business. It requires bare minimal of the Registrations and filings which makes it an efficient yet easiest form of business for starting which also requires a minimal amount of formalities. After starting up the proprietorship though, it could get relatively bit difficult to open up an account in the bank or to get any payment gateway in the name of your business as more of the registrations like GST registration would be required here.
- Business Name: – Because the name of the business is not going to get registered so the sole proprietorship can have the liberty of picking up any name for its establishment, However, it must not be an infringement on an already registered business trademark. But because this business won’t be registered, anyone can use the same name too which a small downside to this. But again this is only when the trademark isn’t registered.
- Lower Taxes: – Sole proprietorships that are with less than Rs 3 lakhs of an income will not be required to pay any taxes as the proprietorships are already taxed as an individual owning this business.
Here in our blog, we have shared the reasons why anyone must opt for sole proprietorship registrations, so more details you may contact Swarit Advisors. We are the leading firm who are well known for offering online legal services to our customers. Once you approach us, we will prepare your documents required in the sole proprietorship registration and will be guiding you until you are done with it. We are 24/7 hr available and have years of experience so reach us unhesitatingly.